Cornell Law Review
Volume 27
Issue 4 June 1942
Article 6
Taking and Destruction of Property Under a
Defense and War Program
Philip Marcus
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Philip Marcus, Taking and Destruction of Property Under a Defense and War Program, 27 Cornell L. Rev. 476 (1942)
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THE TAKING AND DESTRUCTION OF PROPERTY
UNDER A DEFENSE AND WAR PROGRAM"
PHILIP MARCUS*
IV.
THE TAKING OF PROPERTY FOR WAR PURPOSES UNDER FOREIGN
LAW'
A.
Some Comparisons
There are at least two outstanding differences in the law and practice of
the English Commonwealth and Germany, on the one hand, and of the United
States on the other, in respect to the taking of property for war purposes.
In the first two, in general, there has been a broad grant of power to administrative officials to take both real and personal property. In the United
States the distinct tendency has been to give the executive piece-meal authority
and to grant greater powers in respect to realty than personalty. In fact,
2
the chain of express statutory authority is far from complete at present.
The second major distinction is that in the United States there has been
a distinct tendency to take title to realty3 as well as to personalty, whereas
in the English Commonwealth and in Germany legal .authority and actual
practice has rarely gone beyond the use of real property for war purposes.
The taking of title to realty seems to be exceptional. Thus, in the United
Kingdom and other parts of the British Empire the term "requisition" generally has a more restricted meaning in respect to realty than it has to most
sorts of personalty. It has been said of the United Kingdom that, "When
tThis is the second and final installment of this article, the first having appeared in
(1942) 27 CORNELL LAW QUARTERLY 317 [Ed.).
*The views expressed are those of the author and not necessarily those of any government agency.
'Throughout this article reference has been made, to some extent, to the law and
practice in other countries in respect to some particular aspect of the taking and
destruction of property for war purposes. In this part of the memorandum an attempt
has been made to collate some significant characteristics of taking under foreign law.
Some of the contingencies provided for and some of the language used might well be
considered by the authorities in this country.
The picture given here is by no means complete, largely because of the limitations of
the2 writer.
See supra p. 340 et seq. This is especially true of personalty. There is no such
general expropriation statute in respect to personalty as there is in respect to realty.
Although there is much to be said for construing the Requisitioning Act of October 16,
1941, broadly, in view of the fact of its similarity to the Act of October 10, 1940, which
Congress was aware had been construed by the Administration of Export Control and
the Board of Economic Warfare to cover almost all kinds of personalty, the legislative
history of the Requisitioning Act is not too comforting on this score. Some Congressmen have introduced bills for the taking of certain types of personalty such as automobiles, on the assumption that authority therefor was lacking.
3
See infra, PT. VI, C.
1942]
PROPERTY UNDER A WAR PROGRAM
dealing with land a distinction should be drawn between acquisition and requisition, the latter being the temporary use as distinct from the permanent
acquisition of property. So far as goods other than vessels, vehicles and
aircraft are concerned, a requisition is treated as and 6ompensated as a compulsory acquisition,"4 but there is reason to believe that even as to personalty
the preference is to "requisition for the emergency." 5 "Acquisition" and
"requisition" are similarly distinguished in Canada. 6
In the United States the term "requisition" has been used in statutes, presidential proclamations, executive orders, and commandeering orders with only
occasional clarification of the meaning of the term.' No little trouble arose
out of requisitioning orders during the last world war because it was not clear
whether possession or title was taken. To avoid similar confusion during the
present war,8 a distinction such as that found useful in England might be
adopted here; but if care is taken by administrative officials to spell out in
the requisitioning order what they are taking, the term presents no particular
difficulty. In view of the indefinite use of "requisitioning" in this country it
seems clear that where requisitioning is provided by statute, it includes a
taking of title as well as a temporary possession, unless the context indicates
the contrary.9
B. British Commonwealth
1. England.'0-The basic powers of the English government over property
rights stem from the Emergency Powers Act of 193911 and the Emergency
4(1940) 84 SOL. J. 387. This distinction is made in the British Compensation (Defence)
Act, 1939, 2 & 3 GEO. VI, c. 75. It has been stated that the prerogative power. (emergency power of the Crown) allows the taking of temporary possession. Note, (1942)
Requisitioning of Land, 86 SOL. J.53.
5
See Swift v. MacBean [19421 1 All Eng. Rep. 126, 129.
6See Statutes of Canada, 1940, 4 GEo. VI, c. 28.
7It has been considered to include the complete taking of something, including title,
as compared to regulation, Campbell v. Chase National Bank of N. Y., 5 F. Supp. 156,
175 (S. D. N. Y. 1933), aff'd on other grounds, 71 F. (2d) 669 (C. C. A. 2d 1934),
appeal
dismissed sub norn., United States v. Campbell, 293 U. S. 592 (1934).
8
The government's embarrassment may not be revealed until after the war when it
seeks to return the property to one who refuses and claims that title had been taken
from him. A title searcher might well pause at the sight of a notice which merely says
certain property is hereby requisitioned by the United States. The courts occasionally
have been confronted with the problem whether title or use has been requisitioned.
E.g., The Katingo Hadjipatera, 40 F. Supp. 546 (S.D. N. Y. 1941) (ship) ; United
States
v. Boston C. C. & N. Y. Canal Co., 271 Fed. 877 (C. C. A. 1st 1921) (canal).
9
Congress knows how to limit the meaning of the term. _q. Pun. L. No. 178, 77th
Cong., 1st Sess.: "requisition the use of, or the possession of foreign vessels."
'OThe United Kingdom consists of England, Scotland, Northern Ireland, and Wales.
Many of the emergency laws, regulations, and statutory rules and orders issuing from
London apply to all. In some cases applicability to Scotland and Northern Ireland is
permissive; in others, they are made inapplicable to one or both; in some instances, they
are applicable with minor modifications.
11L. R. Statutes, 1939, Pt. II, c. 62.
CORNELL LAW QUARTERLY
[Vol. 27
Powers (Defence) Act of 1940.12 These Acts, in addition to conferring
extremely broad powers upon the executive branch of the government to
carry on the war program, expressly provide for the taking of property.
Under these enabling Acts, a number of defence regulations and statutory
orders have been issued in respect to the compulsory taking of property. In
addition, a number of permanent acts exist under which property may be
taken for war and defence purposes; where there i's necessity for permanent
acquisition of realty these acts are wont to be resorted to.
Under the defence regulations, authority is conferred to take drastic steps
1 4
3
in regard to property rights in protected places' and in protected areas.
The use of certain highways and rights of way may be limited or proscribed.' 5
Power is given to do any work on land by any member of His Majesty's
forces in the course of his duty as such, or by any person authorized by a
competent authority.' 6 Possession of land may be taken by competent authorities for purposes which include "maintaining supplies and services essential
to the life of the community" ;17 practically unlimited powers have been given
to do with land as desired or to prohibit the uses thereof,' s including the
power to work coal. 19 Water undertakers are authorized to secure additional
sources of supply from lakes and other bodies of water.2 0 For the better
utilization of agricultural land, the Minister of Agriculture and Fisheries can
require the owner, if the latter is at fault, to recondition the land, can purchase
the land by agreement, or, if his order is not obeyed, may take it by compulsion. 21 Air raid wardens and other specified civilian defence workers have
123 & 4 GEo. VI, c. 20 (1940).
See also the Emergency Powers (Defence) (No. 2)
Act,3 1940, 3 & 4 GEO. VI, c. 45.
14 Defence General Regulations (vol. 1, 10th ed.) Reg. No. 12.
3 1d., Reg. No. 13.
151d., Reg. No. 16.
16Id., Regs. Nos. 50 and 50b. Under this regulation, conversely, the doing of any
work on particular land may be prohibited. Anything removed may be stored, sorted,
and, so far as appears to be valueless, disposed of.
171d., Reg. No. 51. Advance notice is not necessary, but in practice a requisitioning
notice is usually given, Note, (1942) Requisitioning of Land, 86 SOL. J. 53. A requisitioning notice to the effect that possession would be taken by a specified future date
has been held not to relieve a purchaser from his contract. It re Winslow, (1942) 86
SOL. J. 53. On its facts the decision is questionable unless, as pointed out in the
comment, it is recognized that not infrequently such notices are withdrawn prior to
the time when possession is to be taken.
'81d., Reg. No. 51. Certain provisions of a number of permanent statutes have been
suspended. See Regs. Nos. 51 and 52. As to land, the major number of requisitions
have been made for the Army, with a substantial number being for the Royal Air Force
and the Navy. Requisitioning also has been resorted to frequently in respect to schemes
for rehousing of the homeless and for civil evacuation. See Report of Mr. John W.
Morris on the requisitioning of land and buildings and the operation of the Compensation
(Defence) Act of 1939, Cmd. 6313 (1941).
19S. R. & 0. No. 92 (1942).
Consignments of coal may be diverted. Reg. No. 56b.
20S. R. & 0. No. 502 (1942).
21
Agricultural Land Utilization Act, 1931, 21 & 22 GEo. VI, 2.41. See HAILSHAM,
1942]
PROPERTY UNDER A WAR PROGRAM
been given power to enter upon premises and to take steps to extinguish fires
22
and to protect persons and property from fire.
Authority to requisition property other than land includes the power to use
any chattel in the United Kingdom, any British ship or aircraft, and anything
thereon wherever the ship or aircraft is located (but not Dominion ships,
aircraft, or cargo) ;23 exceptions exist, however, as to currency, gold, securities,
or negotiable instruments.2 Space and accommodations on ships and aircraft 25 may be commandeered as well as contract rights thereto. 26 Orders
may be given to persons having power to dispose of chattels outside the
United Kingdom, 27 and shares of domestic companies which own or have
power to work minerals in foreign countries may be transferred to government
nominees but title to land is not to be transferred).28
The Minister of Supply may designate undertakings to be controlled.2
Thereafter they are subject to orders or directions of competent authorities.30
General control of industry may be effected by designating persons to carry
31
on the undertaking for the government. The control may be partial or entire.
Authority exists for the removal by a recovery officer of chattels left in
damaged buildings, if he thinks the damage is such that the chattels, if left,
would be liable to destruction, deterioration, or loss. This power is not to
be exercised if the owner objects. When removed they are to be stored, but
the recovery officer may remove them to a place arranged by the owner.
Goods stored cannot be taken away by the owner except at a time agreed upon
and with a receipt; the recovery officer, however, may require the owner to
remove the chattels stored if he thinks the owner is in a position reasonably
to comply with the request. The recovery officer may cleanse or disinfect
the chattels, and after consultation with the local medical officer of health,
may destroy the chattels if too infected to make disinfection practicable;
if disinfection is not practicable, he may destroy them before they are likely
to contaminate other premises or chattels. 32 Under the English Defence
LAws OF ENGLAXD (Supp. 1941) Agriculture, 17, 29-30. He may direct that agricultural
land
22 may not be used for other than agricultural purposes. Reg. No. 61.
See (1940) 84 SOL. J. 434.
23
Reg. No. 53. A transferee may be given clear title, and a prior period of requisition
of a ship or aircraft ends upon the beginning of the day the notice of acquisition is served.
24
Reg. No. 53. The exception refers to the provisions of Reg. No. 53.
-Reg. No. 54.
26Ibid.
2
7Id., Reg. No. 53.
28S. R. & 0. No. 381 (1942).
29
Reg. No. 54 c.
3OIbid.
W'Id., Reg. No. 55.
32S. R. & 0. No. 1499 (1941). Cf. Reg. No. 60j.
CORNELL LAW QUARTERLY
[Vol. 27
Regulations, in evacuation areas, premises requisitioned by the government
are considered unoccupied even if furniture and other goods are present in
the premises.33 In order to facilitate the use of requisitioned empty houses,
the Minister of Health has authorized certain local public bodies to requisition
furniture or household equipment in any unoccupied premises or stored in
any depository, of fuiniture, to furnish accommodations for persons rendered
34
homeless as the direct or indirect cotisequence of enemy action.
In England, the Army Act of 1881, as renewed annually, provides for the
compulsory furnishing, by persons having suitable carriages, of animals and
drivers to move regimental stores and baggage along a particular route.
Under one section of the Act, a requisition of "emergency" may be issued
which may include food and forage for the purposes mentioned in the requisition. In addition, in time of war, requisition may extend to the above items
for purposes of'purchase as well as hire.3 5
In England much of the necessary requisitioning is done by staffs specially
trained and selected for such work.86 A War Agricultural Executive Com37
mittee is consulted in the requisitioning of agricultural land.
2. Australia.-The National Security Act passed in 193938 authorized
the'Governor-General 9 to make regulations for public safety and defence.
That statute specifically authorized the "taking possession or control, on behalf
of the Commonwealth, of any property or undertaking." It also provided for
the acquisition, on behalf of the Commonwealth, of all property except land
in Australia. An amendatory act in the following year, 40 did not remove this
qualification, but did provide that regulations could be made requiring persons
to place their property at the disposal of the government.
To a substantial extent, Australian Defense Regulations have followed those
of England in respect to the use of land.4 ' The statutory orders which provide
33
See
34
85 SOL. J. 434.
See 84 SOL. J. 614.
15See Roadways Transport Development Ltd. v. Attorney General [1942] 1 All Eng.
Rep.
52 (C. A.).
36
See Report of Mr. Jdhn W. Morris on the requisitioning of land and buildings and
the operation of the Compensation (Defence) Act of 1939, Cmd. 6313 (1941). For the
Army, the actual requisitioning in an Army Command is generally done by Sub-Area
Quartering Commandants under the supervision of a high ranking officer, and a few
occupied houses have been requisitioned. The Admiralty, the Royal Air Force, and the
Ministry of Works and Buildings exercise requisitioning powers through special units
of 3these
agencies, or, in some instances, through delegated agencies.
7
See rzpra note 36.
38Commonwealth Act No. 15 (1939).
39
Held not an unconstitutional delegation of legislative power, Wishart v. Fraser
(1941)
15 AusT. L. J. 24.
40
Commonwealth Act No. 44 (1940).
41
Under National Security (General)
Regulations, Reg. No. 55, the use of land may
1942]
PROPERTY UNDER A WAR PROGRAM
for taking of personal property are, however, quite numerous 42 and show
considerable variance from English practice. Typical is' the provision found
in the dried fruits order that the Minister, by an order published in the
Gazette, may declare that any dried fruit is acquired by the Commonwealth;
thereupon the Commonwealth gets absolute property rights free from all
43
claims, and rights in such fruit are converted into claims for compensation.
The Minister of State for Trade and Customs has been given broad
acquisition powers which provide for the vesting of title and require that
peaceable possession be given to the Government, but apparently not delivery."4
But the Minister of State for Supply and Development can require any "person
who manufactures, produces, deals in, or has control of any goods to supply
and deliver to the Minister or to a designated person, specified goods within
a specified time. 45 Under the Coal Control Regulations, an owner of a coal
46
mine may be ordered to supply coal to any person.
3. Caida.-On September 13, 1939, the Department of Munitions and
Supply Act47 came into force. This Act, as amended August 7, 1940,48 gives
the government wide powers over the acquisition and use of real or personal
property either by voluntary or compulsory means. The Canadian War
Appropriation Act of 194049 empowered the Governor in Council to prescribe
administrative practices for the acquisition of land, buildings, equipment,
stores, materials, and supplies. The Canadian National Resources Mobilization Act of 194050 gave the Governor in Council power to require persons
be subjected to restrictions. Reg. No. 55a provides that fixtures and other structures
placed on the land by the Commonwealth are to remain its property, with a right of
removal.
42
E.g., Australian S. R. No. 96 (1939) (Wheat Acquisition Regulation); S. R. No.
129 (1939) (Supply of Goods Regulation) ; S. R. No. 20 (1940) (ships, space, and
accommodations); S. R. No. 189 (1941) (Coal Control Regulation); S. R. No. 30
(1941) (Shipping Requisition Regulation); S. R. No. 18 (1940) (Cold Store Regulation) ; S. R. No. 79 (1940) (acquisition of tools to work mines) ; S. R. No. 65 (1940)
(dried fruits) ; General Regulation No. 59 (general control of industry) ; S. R. No. 282
(1940) (foreign currency). Reg. No. 57 of the National Security (General) Regulations covers the taking of personal property and provides that the Minister may hold,
sell, or otherwise dispose of it as if he were the owner.
43S. R. No. 65 (1940).
44S. R. No. 176, § 44 (1940) (National Security (Prices) Regulation).
45S. R. No. 129 (1939).
46
The Minister may also direct any owner or other person to carry, convey, deliver,
or47discharge coal to or from any place or ship, S. R. No. 189 (1941).
Statutes of Canada, 1939, 3 GEo. VI, c. 3.
48
Statutes of Canada, 1940, 4 GEo. VI, c. 31.
49
Statutes of Canada, 1940, 4 GEo. VI, c. 3. The Supplementary 1940 War Appropriation Act (Statutes of Canada, 1940-41, c. 10) is comparable to the emergency fund
appropriations created for the President in this country, in the almost limitless powers
given to the governor in council to use the moneys appropriated. The War Appropriations
Act of 1941 appropriated additional moneys for similar purposes.
50Statutes of Canada, 1940, 4 GEO. VI, c. 13.
CORNELLLAW QUARTERLY
[Vol. 27
to place their services and property at the disposal of His Majesty in the right
of Canada for purposes which include public safety and the maintenance of
supplies, or services essential to the life of the community. 51 The Royal
Canadian Air Force Act of 1940, contained a provision that "The officer
commanding any unit of the air force on active service may, subject to regulations, enter upon, take or destroy any private property, real or personal,
required to be entered upon, taken or destroyed for the purpose of meeting
the emergency."
It is noteworthy that the Canadian Defense Regulations, while containing
a number of provisions found in the English Defence Regulations, have no
provisions for the requisitioning or acquisition of land although Regulation 48
provides for the requisitioning of property other than land.52
Under a Foreign Exchange Acquisition order, residents have been required
to sell their holdings of foreign exchange to a Foreign Exchange Control
Board.53
In respect to commodities, a number of officials known as Controllers have
been appointed with comprehensive requisitioning power over the particular
commodity under their control.5 4
4. New Zealand.-Under the New Zealand Emergency Regulations Act,
regulations similar to those of England have been issued regarding the expropriation of property. 5 Authority has been given to take over over-seas
securities held by New Zealand residents. 56
5. British Colonies.-In March of 1939, the Crown made an order in
council 57 which provided for the security of the Colonies in time of emergency.
It could be made applicable by a Governor of a Colony at any time he should
decide there was a period of emergency. The powers conferred included the
power to take and control property. The Emergency Powers (Defence) Act
of 24, 1939, stated that its provisions could be made applicable to the Colonies
51
Some examples of provisions for expropriation are P. C. 3555, August 17, 1940
(wool);
Canadian Defense Regulations (1940) Regs. 3, 8, 19, 48.
52
During the last world war a Canadian Order in Council of March 17, 1917, streamlined the provisions of the expropriation law of 1906 and permitted the taking of personal
property used with realty as has been done in the United States by the Second War
Powers
Act.
5
54
See (1941)
22
JOURNAL OF THE PARLIAMENTS
OF THE EMPIRE,
75 et seq.
E.g., P. C. 4996 (1941). The Controller of Chemicals is given power to take possession, or otherwise acquire chemicals and/or equipment, to take possession and use
himself or by any person duly authorized by him, of plants and buildings, used or capable
of being used for making and/or dealing in any chemicals and/or equipment.
55
See (1940) 21 JOURNAL OF THE PARLIAMENTS OF THE EiM[PIRE 524.
56
See Hearings before the Subcommittee of Senate Committee on Appropriations on
H.5 7R. 5788, 77th Cong., 1st Sess., 723.
The Emergency Powers Order in Council. See Dale, War Legislationi in the
Colonial Empire (1940) 22 J. CoMp. LEG. & INT. L. (3d series) 1-2.
1942]
PROPERTY UNDER A WAR PROGRAM
by an order in council. On the following day an order making the Act
applicable was issued. 8 The Emergency Powers (Colonial Defence) (Amendment) Order in Council of June 7, 1940, made the Emergency Powers
(Defence) Act of 1940 applicable to the Colonies.
The Colonies have issued defense regulations which follow very closely
those of the mother country. In addition, most of them have basic expropriation laws and some of them have special laws concerning the taking of property for Army and Navy purposes. After the agreement between the United
States and Great Britain which resulted in the United States acquiring a
right to lease lands in specified British Colonies in the Western Hemisphere,
some of the Colonies passed special expropriation Acts whereby lands could
be acquired for the United States by a special procedure.59
C. Belgium
Prior.to the outbreak of the war realistic Belgium had provided for requisitioning in time of war. The exercise of the power was vested, according
to the nature and purpose of the requisition, in competent Ministers and in
the officials to whom they should delegate the power: in Provincial Governors,
District Commissioners, Burgomasters, and in exceptional cases, in any
official, employee, or agent of the State, a Province, or a Commune. 60 The
requisitioning power extended to all persons and objects; military took
priority over civil requirements, and in the case of the latter, the order of
priority was: State, Province, Commune. 61
D.
Cuba .
In Cuba, shortly after the attack on Pearl Harbor, laws were passed
authorizing the President to expropriate articles and materials necessary for
the immediate welfare of the population. 62 He was given power also to take
over industrial and agricultural plants and establishments, public utilities,
and similar enterprises. 3 At the same time, Government control was established over all forms of transportation and communications,64 and it was made
65
obligatory, in certain cases, to cultivate certain crops in lieu of sugar cane.
-8The
Emergency Powers (Colonial Defense) Order in Council of August 25, 1939.
5
9E.g., St. Lucia (Lands Acquisition) (United States of America Naval and Air
Bases) Ordinance, 1940; British Guiana Acquisition of Land (United States of America
Air0 and Naval Bases) Ordinance, 1940.
UNIVERsAL DIGEST OF LAws AND ORDINANCES (1938) Vol. II, p. 453.
61Ibid.
62A short summary of some of these emergency laws is found in (April, 1942)
BULLETIN OF THE PAN
63
AMiERICAN UNION.
(March 21, 1942) 7 Foil. CoAL WEEKLY 14.
641bid.
65Ibid.
CORNELL LAW QUARTERLY
[Vol.27
Still another law gave the President authority to acquire, repair, construct,
or obtain machinery, equipment, and other articles necessary for civilian
defense.
E.
66
France
In France, the General Mobilization Act of July, 1938, empowered the
government in war time to requisition material resources. After the Vichy
government came into power collectors were appointed to requisition and
67
redistribute available stocks.
F.
68
Germany
The German Constitution.of August 1, 1919, gave the Reich power to enact
statutes relating to the expropriation of real property. The Reich did not
use this power to enact a general expropriation statute, and in general, the
laws of the several states were resorted to when it was desired to take property
for public use. 69 Some special expropriation statutes were enacted by the
Reich for particular purposes, and the Reich provided for its own procedure,
rather than that of any state, in a statute dealing with the enforcement of
certain sections of the Versailles Treaty.
On July 13, 1938, a law concerning contributions 0 for defense purposes
was enacted,7 ' and amended on September 1, 1939.72 The original law, in
terms, was designated to be for defense purposes. The amending law used
the term "National" purposes. The Contributions Law applies to the use
of personalty, to the transfer of title to personalty, and to the use of real
property. It does not apply to the transfer of title to real property.7
Contributions of shelter, 74 of food,7 5 use of watering places,71 delivery of
66Ibid.
67
See WORLD EcoNomIc SURVEY (1939-1941), EcoNo Ic INTELLIGENCE
386et seq.
SERVICE
(1941)
8See MARIN, EXPROPRIATION FOR PUBLIC USE IN THE DIFFERENT COUNTRIES, International
Congress of Social Authorities, Expropriation of Land (Seville, 1928) 42.
69
There is a striking parallel in this respect to the United States where federal condemnations
first relied upon state tribunals and later upon state procedure.
7
oObligated to contribute are inhabitants, persons who own property witliin the Reich's
territory so far as their property is concerned, and German citizens on board German
ships.
71
"Gesetz ueber Leistungen fuer Wehrzwecke (Wehrleistungsgesetz) ", Reichsgesetzblott,
72 Tel 1, No. 112, p. 887.
"Gesetz ueber Sachleistungen fuer Reichsaufgaben (Reichsleistungsgesetz)", Reichsgesetzblott,
Teil 1, No. 116, p. 1693.
73
Apparently state laws could be used to take title to realty.
74§ 5.
75§ 6.
76§ 7.
1942]
PROPERTY UNDER A WAR PROGRAM
food, 77 delivery of fuel, 78 use of real property, buildings, and bodies of
water,7 9 delivery of articles of consumption and equipment,80 use of private
communication equipment,81 sharing of workshops,82 requisition of electrical
5
power and gas,83 delivery of movable objects,8 4 supply of transportation,
8s
86
aid in servicing of airplanes, and.use of boats, may be required by other
agencies as well as by the Army.88 As to a few of the required contributions,
provision is made that they need not be given where serious inconvenience
to family life would result.
In place of individuals, muhicipal corporations may be obligated to
contribute8 9
G. The Netherlands Empire0
The Netherlands Constitution provides that expropriation for the common
weal can take place only when a preceding law declares that the common weal
demands expropriation. It is further provided, however, that the law determines the cases in which previous authorization by law is not required. 91
If in the event of war, immediate possession becomes necessary, expropriation
92
can take place upon order of the highest civil or military authority present.
"When it is made known that danger of war exists according to the meaning
of the laws of the land, or if war has actually broken out, our Minister of
93
Agriculture, Industry and Commerce, can authorize mayors to confiscate
household articles and fuel in
immediately all commodities, raw materials,
94
the municipality without any formality.3
Under these laws it is clear that both realty and personalty were subject
to expropriation by administrative action at the time of the German invasion
77§
78§
79§
80§
81§
82§
8.
9.
10.
11.
12.
13.
83§ 14.
84§
15.
85§
86§
87§
88§
16.
17.
18.
4. Special provisions exist as to equipment and outfit of boats. See § 19.
turn it may ask for contributions from individuals in the municipality.
OThe writer is indebted to the Netherlands Information Bureau for translations and
on which most of this subsection is based.
information
91
1t is also provided that the use of property for the preparation or carrying out of
when demanded by war or danger of war, will be regulated by law.
inundations,
92 Expropriation Law, Art. 73.
9 3Expropriation would seem a preferable term since compensation is provided for.
94
Expropriation Law, Art. 76a. Such authorizations can take place only when the
state of war or siege has been declared. Art. 76f.
89
1n
9
CORNELL LAW QUARTERLY
[Vol. 27
'in 1940, even though under normal conditions expropriation took place by
court procedure.
When Holland came under German occupation, the Netherlands Government, moving to London, issued a Royal Decree on May 24, 1940, transferring
all assets abroad of Netherlands to the Government for safekeeping during
the duration of the war; the Japanese invasion of the Netherlands East Indies
evoked a similar decree. In exceptional cases, accelerated restitution is given
in advance of the date set for the general return of property to the rightful
owners.
95
It has been said that, in 1940, the Netherlands Minister in London appointed
a Netherlands Shipping Committee which subsequently became the Netherlands Shipping and Trading Committee. The Minister of Commerce, Industry
and Shipping empowered this Committee to become custodian of all Dutch
ships belonging to owners in occupied countries, and of all goods afloat or
ashore in any part of the world belonging to or consigned to persons in
occupied countries. All cargoes in Dutch ships and all Dutch cargoes in other
ships, it is said, were requisitioned by Great Britain upon their arrival in
Great Britain.
V.
96
PURPOSES FOR WHICH PROPERTY MAY BE TAKEN
That property may be taken for war purposes seems a self-evident statement. Many problems do arise, however, as to the purposes for which property
may be taken or destroyed. One of such problems, not here discussed, but
noted, is that of interpreting statutes which speak in terms of "military
purposes," or some phrase less inclusive than "war purposes. ' 97 In England,
the Defence Regulations expressly provide that the use of land may be taken
for purposes of "the public safety, the defence of the Realm or the efficient
prosecution of the war, or for maintaining supplies and services essential to
the life of the community. 98s Similar regulations exist. as to the taking of
'chattels. 99
In the law of eminent domain the concept that this power can be exercised
only for a public use is deeply engrained.10 The courts have reserved to
95
Netherlands
96
News, April 1, 1942, p. 54.
Letter from a correspondent to THE ECONOMIST, September 14, 1940. Claimants
could press their claims before special agents in various ports, and if the government did
not97 want the goods they were released to claimants who could prove a right thereto.
Moreover, a number of statutes are specifically limited to a narrow purpose.
9SReg.
No. 51.
99
Reg. No. 53.
0
1 See Nichols, The Meaning of Public Use in the Law of Eminent Domnain (1940)
20 B. U. L. REv. 615. See Madisonville Traction Co. v. St. Bernard Mining Co., 196
1942]
PROPERTY UNDER A WAR PROGRAM
themselves the right to determine what is a public use, 101 but their reluctance
to review an administrative determination of the necessity or advisability of
02
a taking is marked.1
In time of war, especially, the courts are not likely to review seriously an
administrative determination that a taking is advisable for the war effort.' 03
The fact that the taking is to bring the government a financial return, in
part, does not necessarily violate the test of public use. Insofar as the taking
helps to pay for a public improvement, even though the extent of the taking
is greater because of the financial return than it would otherwise be, there is
judicial authority that such a taking is valid.' 4 Whether the courts would
be willing to permit a taking for this purpose by itself, rather than as incident
to some other power, may be doubted, but it may be expected that greater
latitude will be afforded the government in this respect than heretofore has
been thought possible. As an aid to or substitute for taxation it has been
little explored.
Taking Property for a Non-Military Purpose
The totalistic nature of modern warfare has caused the governments of
most belligerents to adopt social and economic measures which probably
neither the public at large nor the courts would support in time of peace.
But as an incident to the war effort such measures are likely to be held
valid. Nor is the taking of property for such purposes likely to be struck
down as long as there is a substantial relevance to the war effort.' 0 5 Thus
it is believed that, within certain limitations, property may be taken in time
of war to improve morale or to preserve or rectify economic conditions detri10 7
06
Property has been taken for U. S. 0. centers.
mental to the war effort.'
A.
U. S. 239, 251 (1905); United States v. Gettysburg Electric R. Co., 160 U. S. 668,
6790 (1896) ; In re Manderson, 51 Fed. 501, 503 (C. C. A. 3d 1892).
0' Rindge Co. v. County of Los Angeles, 262 U. S. 700, 705 (1923) ; Block v. Hirsh,
2561 02U. S. 135, 154 (1921) ; Shoemaker v. United States, 147 U. S. 282, 298 (1893).
Barnidge v. United States, 101 F. (2d) 295 (C. C. A. 8th 1939); United States
v. Threlkeld, 72 F. (2d) 464 (C. C. A. 10th 1934), cert. denied, 293 U. 'S. 620 (1934).
The question of necessity of a taking for public use is a legislative and not a judicial
question. Georgia v. Chattanooga, 264 U. S. 472, 483 (1923); Rindge Co. v. County
of 03
Los Angeles, 262 U. S. 700, 709 (1923).
' See Note, Reqzdsitioning of Land (1942) 86 SOL. J. 53.
' 04 Oklahoma v. Atkinson Co., 313 U. S. 508 (1941). Cf. Buchanan v. United States,
78 Ct. Cls. 791 (1934), cert. denied, 294 U. S. 723 (1935).
lOSThe Attorney General in 1918 (31 Ops. ATr'Y GEN. 198) advised the President
that under the Lever Act he could requisition cottonseed cake to preserve the cattle
herds of Texas and insure a proper meat supply for the country. The terms of the
Lever Act relied upon were "public use connected with the common defense." Cf. 31
Ops.
AT'y GEN. 344 (1918).
' 06 New Zealand has passed a Small Farms Amendment Bill which gives the government power to take land for settlement to provide small farms for soldiers when the
war07ends. See (March, 1941) RouND TABLE, 391-392.
' United States v. 8677 Acres of Land, 42 F. Supp. 91 (E. D. S. C. 1941). Accord-
CORNELL LAW QUARTERLY
[Vol. 27
In A-ndrews v. Howell,108 it appeared that under the Australian National
Security Act, which gave the government broad powers to prosecute the war,
a pear and apple acquisition regulation was issued, which stated that its purpose was to minimize the effect of the disorganization of the market from
inability to export those commodities because of lack of shipping facilities
caused by the war. In December of 1940, the Minister ordered the acquisition
of all apples and pears harvested between July 1, 1940 and July 1, 1941.
The regulation also prohibited the moving of the fruit so acquired. Prosecution and conviction could be had for violation of the prohibition against
moving. The defendant argued that a regulation of this sort was not within
the defense powers of the government and violated section 51 of the Australian
Constitution. 10 9 The court dismissed the appeal, and one of the judges stated
that the course of war made it necessary to consider that the internal condition
of the country had a substantial bearing upon the prosecution of the war.
B.
Use of Eminent Donain or the War Power t, Take Property in Aid of
°
Another Constitutional Power' 09
The eminent domain power, wherever appropriate, may be used in aid of
any of the constitutional functions or powers of the government." As argued
in the preceding subsection, in time of war such aid may, in respect to the
war effort, be quite broad. The question may arise, however, whether a right
to take property may be implied where a statute confers a certain power upon
the executive branch of the government without conferring in express terms
the power to take property for such purpose. It is believed that the answer is
ing to the government's brief in Vogelstein & Co. v. United States, 262 U. S. 337 (1923),
at the request of businessmen, requisition was used to protect them from being sued
for breach of contract. See supra p. 319.
108(1941) 15 AusT. L. J. 127.
109This section provided that Parliament, subject to .the Constitution, has the power
to make laws with respect to "The acquisition of property on just terms from any state
or person
for any purpose in respect of which the Parliament has power to make laws."
09
'See supra pp. 318-319.
"0Cf. Art. I, § 8, 111i1, 18 of the United States Constitution. See Oklahoma v.
Atkinson Co., 313 U. S. 508 (1941) ; State of Minnesota v. United States, 125 F. (2d)
636, 640 (C. C. A. 8th 1942) ; United States v. Gettysburg Electric R. Co., 160 U. S.
668, 681 (1896) ; Luxton v. North River Bridge Co., 153 U. S. 525, 529, 530 (1894) ;
Cherokee Nation v. Southern Kansas R. Co., 135 U. S. 641, 656 (1890) ; Fort Leavenworth R. Co. v. Lowe, 114 U. S. 525, 531 (1885) ; Kohl v. United States, 91 U. S. 367,
371 (1875) ; C. M. Patten & Co. v. United States, 61 F. (2d) 970, 972 (C. C. A. 9th
1932), dismissed as moot, 289 U. S. 705 (1933) ; Burley v. United States, 179 Fed. 1
(C. C. A. 9th 1910) ; Alabama v. United States, 38 F. (2dj 897 (1930), rev'd on other
grounds, 282 U. S. 502 (1931) ; New York City Housing Authority v. Muller, 270 N. Y.
333, 341, 1 N. E. (2d) 153 (1938) ; United -States v. Tiffin, 190 Fed. 279, 280 (N. D.
Ohio 1911) ; High Bridge Lumber Co. v. United States, 69 Fed. 320, 325 (C. C. A. 6th
1895) ; Rudacille v. State Commission, 155 Va. 808, 821, 156 S. E. 829, 834 (1931)
16 Ops. Ar'y GEN. 369, 371 (1879).
11942]
PROPERTY UNDER A WAR PROGRAM
no, unless it is reasonably contemplated that the power granted could not
be exercised adequately without resort to expropriation."-1
Nevertheless, such lack of authority does not necessarily foreclose the
acquisition of property. Other statutes may confer upon the President the
power to acquire property for purposes broad enough to cover implementation
of another power given to some agency or agencies of the government. In
such event, he might acquire the property himself, have some agency act for
another," 2 or whenever possible, delegate the power to the agency itself." 3
These devices may be and have been used by various agencies of the government-one agency without eminent domain power or funds asking another
agency having such powers to exercise them in its behalf." 4 Such means of
using one agency to acquire property for another may be legally justified
under statutes which expressly provide for freedom of disposition on the part
of the acquiring agency. Where the statute authorizing the acquisition of
property does not authorize the acquiring agency to dispose of it, possibly
the power of the President and that of executive agencies to transfer public
property from one agency to another might allow ultimate acquisition or
control of the property by the agency which never had the right to take
property by eminent domain." 15 It could be argued that where a permitted
power of expropriation is useless without a power of disposition, that power
may be implied." 0 However, this backhanded method of supplying to agencies
eminent domain or dispositive powers not given them by Congress, at times
runs into practical difficulties, at times skirts along legal quicksands," 7 and
"'1This does not mean that the President under his constitutional war powers, might
not be found to have such authority. Justification probably would have to be found in
an immediate and pressing necessity. The courts are not inclined to find a grant of
the power by inference. See United States v. Powers, 70 Fed. 748 (S. D. Ga. 1895);
18 Am.
Juis. (Eminent Domain, § 26). See, however, supra p. 333.
112 Cf. Ex. Order No. 9088, 7 Fed. Reg. 1775. Recommendation of the agency desiring the exercise of the powr would probably set the power in motion. See Note,
Aspects
of Wartime Price Control (1942) 51 YALE L. J. 819, 827.
3
"1
As provided for in the Second War Powers Act.
1 4
_ it may be merely a matter of convenience which agency is to acquire the property.
Cf. Ex. Orders Nos. 9121, 9160, 7 Fed. Reg. 2588, 3542.
'l 0 See infra.
11031
Ors. Arr'y GEN. 198 (1918).
17fDuring the first world war, the Price Fixing Committee considered that its foremost
indirect weapon of enforcement, was the power to requisition goods or to place commandeering orders with plants or for supplies.
The threat was to ask proper authorities
to commandeer. It is said that the legal section of the War Industries Board prepared
a memorandum that it was not duress to threaten to commandeer in this form: "These
are the prices to which the government will agree. If you agree we will pay such prices,
if not we will ask the proper authorities to commandeer it and you will get just compensation." See G~aRrr, GOvERNMENT CONTROL OVaR PRICES (i920) 235, and cf. Lajoie
v. Milliken, 242 Mass. 508, 136 N. E. 419 (1922).
CORNELL LAW QUARTERLY
[Vol. 27
is hardly to'be recommended as a method of carrying on governmental
business.
It may be doubted that the power to expropriate property for war purposes
could enable the executive branch of the government to enforce another statutory war power by using the expropriation power as a sanction, where the
statute in question did not provide for any such sanction.'' 7 1 On the other
hand, its use incidentally as a sanction would seem permissible. Thus if the
allocation program bogged down from an inability to compel individual
obedience, complete control over the property which it was desired to allocate,
with the power to determine distribution, might well be considered a war
purpose for which property could be taken, even though incidentally it might
operate as a sanction.
The broad terms of Title IIof the Second War Powers Act 18 would seem
to permit the taking of realty as a means of enforcing another necessary war
power, but its use as a sanction would probably have to be under the guise
of a compensable taking for the public use rather than a penal sanction, in
the absence of a statutory authorization of such sanction. The Requisitioning
Act of October 16, 1941, as amended by the Second War Powers Act,119
may be so used in respect to personalty, but a more liberal construction would
be required for such power to be found within its much narrower terms. The
powers given the Reconstruction Finance Corporation furnish a further means
of exercising the eminent domain power over personalty or realty to reinforce
another war power.'
C.
20
Taking Property for Third Persons
As late as 1935, a federal Circuit Court of Appeals held that property
could not be taken by the federal government for slum clearance and public
housing purposes because it was not a "public use.' 21 The case is probably
not good law today, 22 and the Supreme Court has recognized that the concept
of public use is an expanding one?2 It fs clear that public use does not
117*Cf. Abels, Price Control in War and Emergentcy (1942) 90 U. OF PA. L. REv.
675, 688 et seq. A fortiori, where the statute forbids a taking, supra note 111. Cf.
United
States v. Constentine, 246 U. S. 287 (1935).
1198 See supra pp. 336-337.
U1
See supra pp. 337-338.
1201 See supra p. 341, n. 179a.
12 United States v. Certain Land in Louisville, 78 F. (2d) 684 (C. C. A. 6th 1935),
cert. granted, 296 U. S.567 (1935), dismissed on motion of government, 297 U. S. 726
(1936).
1221t stands practically alone. See Nichols, The Meaning of Public Use in the Law
of Eminent
Domain (1940) 20 B. U. L. REV. 615.
123See United States v. Irvin (Sup. Ct. No. 658, 1942). Cf. Art. 24 of the Cuban
Constitution of 1940 (property may be expropriated for reasons of public utility or
social interest).
1942]
PROPERTY UNDER A WAR PROGRAM
necessarily mean that the property taken must be used by the public.. 4
Where property has been taken under the war power for transfer to or
use by a third person, the question has been raised whether this is a taking
by the federal government for public use.125 The answer to this question is
that "The Government may acquire property for the use and occupation of
another agent whether it be governmental or non-governmental in order to
aid the national defense."126 Modern warfare makes it necessary to exercise
this power for the immediate benefit of third persons as the conduit through
which the war effort may be facilitated, without regard to the nature of the
conduit or whether the third person is a profit-making entity.12 7 Moreover,
the right to take property for the purpose of disposing of it to third parties
has been recognized. 128 During the last war the government took property
from citizens and turned it over to allied countries for use in the prosecution
124 See Nichols, op. cit. s=pra note 122. Cf. State of Minnesota v. United States, 125
F. (2d) 636 (C. C. A. 8th 1942) (for Indians). In International Congress of Local
Authorities, Expropriation of Land (Seville, 1928), it is said at 127:
"It is not absolutely necessary for admission of public use that the expropriated
land should become public property. It is not indispensable that it become property
of an enterprise serving the public and that everyone or even a considerable group
of persons must be enabled to profit from it or to utilize it on equal conditions.
It is not even indispensable that everybody or a considerable group of persons finding themselves in similar circumstances have an equal right to acquire the expropriated property in order to form a new private property. Public use exists whenever there is a utilization of land undoubtedly more desirable for the public good
than
utilization by a natural proprietor."
12 5 1n Olympia Shipping Corp. v. United States, 71 Ct. Cls. 251 (1930), cert. denied,
284 U. S. 680 (1932), the United States took over a ship during the world war and
chartered it to the French Government. The court found it unnecessary to pass upon
the question raised by the plaintiff that the Shipping Board had exceeded its authority
in so
doing.
126 United States v. 243.22 Acres of Land, 43 F. Supp. 561 (E. D. N. 3.1941). In
a condemnation suit instituted upon the request of the Secretary of War, the defendant
attempted to prove that the Secretary of War had entered into an emergency plant and
facilities contract with the American Airplane and Engine Corporation, that the land in
question was being acquired to expand the latter's plant, and that the corporation was
to finance the cost of the proceeding, land and facilities, but was to be reimbursed by
the government with an option to buy the land. The court excluded such evidence since
Pub. L. No. 703, 76th Cong., 3d sess., expressly provided that the Secretary of War
could dispose of property acquired as he saw fit. Cf. International Paper Co. v. United
States, 282 U. S. 399 (1931) ; United States v. Forbes, 259 Fed. 585 (W. D. Ala. 1919),
aff'd, 268 Fed. 273 (C. C. A. 5th 1920) ; 33 Ops. A~rrY GEN. 551 (1923). See Highland
v. Russell Car Co., 279 U. S. 253, 260 (1929).
127Cf. Ex. Order No. 9123, 7 Fed. Reg. 2642.
128 Brown v. United States, 263 U. S. 78 (1923) ; Old Dominion Land Co. v. United
States, 296 Fed. 20 (C. C. A. 4th 1924). It is a public use for the Government to
dispose of its property to private entities where to do so would redound to the public
benefit. United States v. City of Springfield, 22 F. Supp. 672 (D. Mass. 1938), aff'd
sub norn., Springfield v. United States, 99 F. (2d) 860 (C. C. A. 1st 1938), cert. denied,
306 U. 5. 650 (1939) ; State of Alabama v. United States, 38 F. (2d) 897 (1930),
rez/d on, other gronds, 282 U. S. 582 (1931). And see United States v. 243.22 Acres
of Land, supra note 126.
CORNELL LAW QUARTERLY
[Vol. 27
of that war. In this war, this sort of aid has been implemented by the LendLease program. In a number of instances the War Production Board has
requisitioned scrap metal which the Metals Reserve Corporation has paid for
and in turn has sold to a dealer.'2
The German Contributions Law' 80 expressly provides that agencies, outside
the Armed Forces, which are entitled to contributions, may demand contributions for third persons.
In England, statutes and defence regulations clearly permit such taking;
to a limited extent this was permitted in peacetime. 131
D.
Billeting
1. Billeting in the United States.-To compel an occupant of property
to lodge some stranger in time of war, is not a familiar concept to present-day
Americans. But recently, billeting has been discussed seriously in connection
with securing quarters for defense workers. During the last world war, 141
vacant houses were commandeered in Washington for billeting purposes in
the three months prior to the Armistice. 3 2 These houses consisted of dwellings
used only occasionally by wealthy persons; houses for sale but not for rent ;133
18290See Press Release, War Production Board, No. 751, March 31, 1942.
'
See supra p. 484.
131Cf. questions and answers to a questionnaire filled out by the Standing Committee
for England and Wales of The International Union of Local Authorities for the International Congress of Local Authorities:
II. Does the law recognize the right of local authorities to expropriate land?
1. For lines of communication. Yes.
2. For games, recreation, burial grounds. Yes.
3. For erection of public utility-schools, orphanages, slaughter houses. Yesqualifiedly.
4. For the construction of public works in connection with gas, electricity, etc.
Yes.
5. For private industries. No.
6. For cottage gardens.- Yes.
7. For sanitary improvements. Yes.
8. For exchange with other land. Yes, for certain purposes.
9. Which should be built upon and upon which the owners fail to build within
a given period. No. ,
10. Which should be altered or redistributed. No, except for clearance of unsanitary dwellings.
11. Which should constitute land held in reserve for the town. No, but see TowN
PLANNrNG, October 1925, § 8, as to purchase of reserve land by agreement.
12. For the construction of dwellinghouses. Yes.
(b) With reference to questions 5 and 12, to what extent may the town
dispose of the lands expropriated, to private people and subject to what
conditions? Not as to 5; as to 12, land expropriated to provide working
class dwellings or to be cleared, or unsanitary dwellings may be sold
or let to private individuals who will undertake to effect the purposes
of the expropriation.
13 2Report of United States Housing Corporation of December 3, 1918 (Rept. of
Committee
on Requisitioning Houses in The District of Columbia).
' 33 Those having new or newly renovated houses for sale were given a grace period
in which to make a sale.
1942]
PROPERTY UNDER A WAR PROGRAM
493*
and houses in such bad condition that they could not be readily sold or rented.
About 1300 war workers thus were housed.
The founders of the Constitution were familiar enough with the abuses of
billeting to cause a provision concerning that practice to be inserted into the
Constftution. The Third Amendment entirely forbids compulsory billeting
of the armed forces in peacetime, and forbids such billeting in time of war
unless provided by law. It is not clear whether "by law" means "by a statute
of Congress"; probably this would be the reasonable construction. 1 34 It may
be noted that modern war billeting needs are of a nature not covered by the
terms of this Amendment. It would seem advisable for Congress to pass a
statute on this subject before administrative officials feel compelled to do so
without an Act of Congress. No act is known which expressly gives or denies
this power to the executive branch of the government; however, it might be
inferred. 35
2. Billeting elsewhere.-In countries with large armies and more limited
space than the United States, billeting has often been resorted to. Billeting in
the United Kingdom has taken two forms. One has been the traditional
statutory provisions for billeting of the armed forces. 13 6 The other and more
novel form is compulsory billeting of defense workers and evacuees under
the Defence Regulations.1
3
7
At the beginning of the war it was the policy of the English government
to accommodate as many workers as possible in billets near factories. Local
householders were visited by welfare or billeting officers, and their accom134The power of Congress to provide for billeting is clear, not only from its express
powers under the Constitutionbut by negative implication from restrictions on billeting
in the Third Amendment, -Billeting might be possible under state laws such as the
Emergency laws of Massachusetts passed in 1941 and 1942, see supra PT. II, B, 9.
If taking property to provide for defense housing is a public use, as it clearly is, [see
United States v. Stein, 48 F. (2d) 626 (N. D. Ohio, 1931)], compulsory billeting for
the armed forces, for defense workers, for evacuees, or for other war purposes, would
seem5 immune from attack on the question of taking for public use.
13 The process of rationalizing by inference could find such power in Title II of the
Second War Powers Act, in statutes setting up an emergency fund for the President,
and in the powers given to the Reconstruction Finance Corporation. Nevertheless, the
nature of the subject-matter and the lack of any legislative standards might cause the
courts
to hesitate to find such an inference.
13
01.e., The Army Act, The Air Force Act, and The Naval Billeting Act. The
billeting of vehicles, as well as horses, has been provided for. L. R. Statutes, 1939,
c. 17. This Act has a schedule of charges which victualling houses may make for
billeting.
137A third form of billeting might be considered to be the authorization given to local
authorities to use private homes for public shelters to protect the public from war
operations. Defence Regulations, Reg. No. 23. Authority for such action preceded the
war. Civil Defence Act of 1939, 2 & 3 GEo. VI, c. 31. For civil defence purposes the
Act authorizes the compulsory hiring of land; local authorities can post a notice in the
building or a part thereof declaring that the building or a part of it may be required
for use.
CORNELL LAW QUARTERLY
[Vol. 27
modations noted. They could appeal compulsory billeting to a tribunal. 13
For compulsory billeting the standard rate was five shillings and it was not
required to give meals. 139 Recently, more drastic billeting regulations have
been issued for billeting essential workers in designated areas. Persons living
in necessary premises may be prohibited from sleeping therein or from using
them for other purposes. 40 Under the Defence Regulations, billeting notices
are to be delivered to the occupier, but if this is not practicable, to any person
on the premises. 141 The occupier may be required to furnish "such accommodations by way of lodging or food or both, and either with or without
attendance, as may be specified, in the notice for such persons as may be
so specified." Where exclusive accommodation is needed, no prior occupant
is entitled to occupy the room. 142 The Defence Regulations provide for determination of the price of billeting accommodations by the Minister of Health,
and payment by him or some other authorized authority, with a right of
recovery by the Minister from the person accommodated or the person liable
for his maintenance. 143 Disobedience of a billeting notice may subject one
to a criminal penalty.144
These billeting regulations are drastic enough to require extreme care in
their administration. No one likes to be told he is a "parasite" and required
to give up his own living accommodations. But war is a hard taskmaster.
The German Contributions Law, however, imposes a billeting obligation which
145
is less drastic than that of England.
In Australia, ordinances which legalize billeting of Australian troops in
private homes have been extended to include troops of allied nations. 146 A
-3 SProvision was made for creation of billeting tribunals. See Defence Regulations,
Gen.
Reg. No. 22.
' 39 See Note, Housing for Britan's War Workers, BULLETINS FROm BRITAIN, February
11, 1942.
140 Defence Regulations, Gen. Reg. No. 22a, added to the Defence Regulations in
March, 1942, by S. R. & 0. No. 381.
14IDefence Regulations, Gen. Reg. No. 22.
142
1bid. It is "the duty of the occupier of any premises in which accommodation for
any child not accompanied by a person otherwise responsible for his care is so
furnished . . . to care for the child to the best of the occupier's ability." Held
applicable to 14 year old girl in Murray v. Parkes (1942) 86 SOL. J. 100.
3
14
Defence Regulations, Gen. Reg. No. 22.
' 44 1n Mee v. Toone (1940) 84 SOL. J. 427, a criminal suit was sustained against an
occupier for refusing to furnish two children with board and lodging pursuant to a
billeting notice.
'45See §§ 5 and 6. Section 5 provides that rooms and places are to be contributed
to the extent that the person who grants them is not restricted in the use of the space
indispensable for his own needs in regard to his home, commerce, profession, or handicraft. Whether these restrictions have been changed since 1939 when this law was
amended,
is not known.
146
AUSTRALIA, January, 1942; (1942) 15 AusT. L. J. 258. National Security Reg.
No. 78, provides also for billeting of persons in the service of a local governing authority
and engaged in the performance of essential services.
1942]
PROPERTY UNDER A WAR PROGRAM
Quartering Order has been issued providing for the designation of quartering
areas and of quartering and claims officers. In general, keepers of public
houses, owners and occupiers of buildings other than churches and banks, and
private householders may be required to furnish quarters. Payment is to be
made at certain rates set out in a schedule appended to the order. The person
providing quarters may recover for loss or damage occasioned during and
by the occupancy. A quartering and claims officer may authorize payments
up to a certain amount; over that amount, and up to a certain higher amount,
claims go to a special board. Claims above the last-mentioned maximum are
dealt with under the general National Security Regulations pertaining to
47
compensation for damages.1
VI.
KINDS OF PROPERTY WHICH MAY BE TAKEN
Whether the eminent domain power may be exercised against all kinds of
property has been a matter of dispute. 148 There are at least three major
problems involved: (1) Can the nature of the property affect the power to
take? (2) Can the nature of the holder affect the power to take? (3) To
what extent is the taking limited, and what sort of interests in property may
be taken?
A.
The Type of Property
Under this heading will be discussed only certain types of property, the
taking of which has caused lawmakers and law writers some trouble. In the
main, most property is taken without objection on the ground of the nature
of the property.
1. Industrial Plants.-The taking of industrial plants, or rather the possibility of taking them, has aroused much controversy. 149 Despite the fact that
plants clearly may be taken under the Second War Powers Act, 1 0 as well
as under other statutes,151 bills have been introduced recurrently for this
purpose. The problem is an emotional one since it is tied up with the freedom
of labor. Thus far the government has temporarily taken over a number of
plants,_1 52 mainly because of labor trouble. Maintenance of labor service in
147See (1942) 15 Ausi.. L. J.'258. The order does not authorize housing of males
in buildings
occupied solely by women or by women and children.
148 See Colvin, Property Which Cannot Be Reached by the Power of Eminent Domain
for a Public Use or Purpose (1929) 78 U. OF PA. L. REV. 1, and FEDERAL EMINENT
DOMAIN
(Dep't of Justice, 1940).
149 See Note, Executive Commandeering of Strike-Bound Plants (1941)
51 YALE
L. J.
282.
0
15
See supra pp. 335-337.
' 52 See supra p. 338.
15 See supra p. 327. In addition to those referred to in the first part of this article,
three other plants were taken over under Exec. Order No. 9141, 7 Fed. Reg. 2961.
CORNELL LAW QUARTERLY
[Vol. 27
the plants taken over has not caused much trouble. There are probably several
reasons for this amicable relationship. In the first place, the control by the
government has been of comparatively short duration. Probably a better
reason is that the present administration has gained the confidence of labor;
also, the concept of Uncle Sam as a large scale employer is no longer novel.
But if the need arises to freeze labor or managerial services, along with the
expropriation of the physical plant, it is believed that the Constitution does
not prevent the government from doing so in order to facilitate the prosecu53
tion of the war.'
2. Money.-Ex1iropriation of money, in the United States, would have
to surmount two constitutional hurdles. One is the Fifth Amendment with
its requirement of payment of just compensation. The other is the constituTM
tfonal prohibition against a direct tax without apportionment.'
It has been
155
thought that these obstacles are not insurmountable,
but views to the con156
trary have been expressed.
The presence of the Fifth Amendment presents several major problems.
One is whether other constitutional provisions, such as the power to regulate
currency and the power to wage war, are to be read with the Fifth Amendment, or whether that amendment stands alone.157 Another approach is to
determine whether the Fifth Amendment permits payment in something other
than money,15 8 or whether delayed payment is possible. 59
There seems to be no constitutional dffficulty in expropriating foreign
currency since it may properly be considered a commodity, the value of which
may be determined by reference to its exchange value and made payable in
domestic currency. Perhaps a 'similar rationale might justify the taking of
gold coin and bullion, as long as its value was payable i'n currency used as a
' 58 See Hoague, Brown, and Marcus, Wartime Conscription and Control of Labor
(1940) 54 H~Av. L. REv. 50.
1"U. S. CoNsT. Art. 1, § 1, 1 3; Art. 1, § 9, ff 4.
155 See West, The Validity of Forced Loans in Time of War-A Consideration of
S.156
1650 (1940) 8 Gzo. WAsHa. L. Rav. 904.
Cormack, The Universal Draft and ConstitutionalLimitations (1930) 3 So. CALIF.
L. REv.' 361; Colvin, Property Which Cannwt Be Reached by the Power of Eminent
Domain
for a Public Use or Purpose (1929) 78 U. OF PA. L. Rtv. 1.
15 7
See arguments in Ling Su Fan v. United States, 218 U. S. 302 (1910). The court
itself said at 310-311:
"Conceding the title of the owner of such coins, yet there is attached to such
ownership those limitations which public policy may require by reason of their
quality as a legal tender and as a medium of exchange. These limitations are due
to the fact that public law gives to such coinage a value which does not attach as
a mere consequent of intrinsic value."
Cf.58Nortz v. United States, 294 U. S. 317 (1935).
1 See infra Pr. VII, F.
' 69 See infra PT. VII, G, 5.
1942]
PROPERTY UNDER A WAR PROGRAM
standard medium of exchange' 60 Gold as an international medium of ex161
change may have a definite place in the prosecution of war.
3. Business Services.-Compulsory orders placed by the government with
individuals and firms to produce for or turn over to the government products
customarily dealt in by them, were frequent in the last war, and have been
used in this one. Backed by statutes imposing criminal sanctions for refusal,
such orders, in effect, commandeer business services. The commandeering
of such services appears to have the approval of the Supreme Court.1 62
Where it is meant to requisition such services, it is advisable not to leave the
16 3
requisition to inference.
4. Power to Direct or to Require Delivery.-Under the war power it
seems clear that the government could order the diversion of some product
from one destination to another. Less clear, but strongly supportable, is its
power to require delivery of the thing requisitioned. 64 This is illustrated
when ships are requisitioned and the owner or master directed to bring the
vessel to some port different from the one to which it was destined. During
the last world war the fuel administration and the Director General of Railroads on many occasions ordered the diversion of coal shipments. The writer
is unaware of any challenge made to such orders on the ground of lack of
constftutional power, but such orders were frequently challenged on the
ground that they were an exercise of eminent domain. 165 Delivery is commonly
required under the Australian National Security Regulations. 166
The law of eminent domain with its emphasis upon the taking of realty did
not have to consider the problem of physical delivery. In the case of personalty, a requirement of delivery ordinarily has been eschewed. If delivery is
part of the customary service given an owner upon the sale of a commodity,
it may be argued that this is a business service which may be commandeered
along with the commodity. But where this element is lacking, it is believed
that the power to compel delivery is not part of the eminent domain power
t6 0Many of the members of the British Commonwealth have acquired or provided for
the161acquisition of foreign currency, especially that of the United States.
E.g., The New Zealand Emergency Regulations provide for the acqquisition of
gold62 coin and bullion.
1 Cf. Liggett & Myers Tobacco Co. v. United States, 274 U. S. 215 (1927) ; BrooksScanlon Corp. v. United States, 265 U. S. 106 (1924) ; see United States v. Bethlehem
Steel
Corp. (Sup. Ct. Nos. 8 and 9, 1942).
163 See China Mutual Steam Nay. Co. v. MacLay [19181 1 K. B. 33 where the inference 4 was denied.
16 Cf. Order in Penn Chemical.Co. v. United States, 63 Ct. Cls. 15 (1927) "... does
hereby requisition. . . . Delivery of said supplies will be made as directed by the War
Industries Board....
'16See
infra PT. VII, G, 1.
' 66 See stepra p. 7.
CORNELL LAW QUARTERLY
[Vol. 27
and not included in a grant of power to take property for war purposes, 67
although it may be permissible under the war power or under Article I,
§ 8, 1 18 of the Constitution.
5. Patents.-It has been said that during the first World War, the Alien
Property Custodian seized about 10,000 patents belonging to enemy aliens,
and only a few of them were ever returned under the Winslow Act. 16 The
number of claims filed for compensation, however, was substantial. 169 In some
instances the United States appears to have used the inventions prior to
seizure of the patents by the custodian, but generally, if not always, orders of
seizure by their express terms included not otily the patent but all claims for
infringement thereof. Hence claims for past infringement by or for the United
70
States were, as a war measure, seized with the patent by the custodian.
In the United States, the Alien Property Custodian has already seized several
thousand patents.
1 1
The problem of controlling patents, whether held by citizens or alien
enemies, focuses upon several points. One is the compulsory secrecy which
72
legislation, enacted in this country in 1940 and 1941, is designed to insure.1
73
Another is the taking of the patent or use thereof. An Act of June 25, 1910,1
permits officers of the United States to utilize patented inventions on behalf
of the government; a subsequent enactment gives contractors with the government a similar power of expropriation. 1 7 4 Under a statute passed during
the last world war, an owner of a patented invention is given a right to claim
compensation when the invention has been "used or manufactured by or for
the United States without license of the owner thereof or a lawful right to
use or manufacture the same."' 75 Of considerable importance in the taking
or using of patented invertions is the assurance of freedom from infringement
suits desired by private persons who have been allowed by the government to
use such inventions in aid of the war effort. They appear to have this
176
protection.
167 Cf. China Mutual Steam Nay. Co. v. MacLay [1918] 1 K. B. 33.
8
Holtzoff, Enemy Patents in the United States (1932) 26 Am. J. INT. L. 272, 273.
169Ibid.
17 0
Administrative Decision No. 1, War Claims Arbiter (1929) 23 AM. 3. INT. L.
193,7 1197.
' See Press Release of Office of Alien Property Custodian, PM-3522, June 3, 1942.
17254 STAT. 710 (1940), 55 STAT. § 657 (1941), 35 U. S. C. §§ 42, 42f.
17-36 STAT. 851, 35 U. S. C. § 68 (1910). The patentee may sue in the Court of
Claims. This is an exercise of the eminent domain power. See Crozier v. Fried. Krupp
Aktiengesellschaft, 224 U. S.290 (1911).
17436 STAT.851, 35 U. S. C. § 68 (1910).
175 Ibid.; as to a right of compensation for use of unpatented invention, see 54 STAT.
710,
35 U. S. C. § 42 (1940).
17
6Broome v. Hardie-Tynes Mfg. Co., 92 F. (2d) 886 (C. C. A. 5th 1937); Pierce
v. Submarine Signal Co., 25 F. Supp. 862 (D. Mass. 1939).
16 See
1942]
PROPERTY UNDER A WAR PROGRAM
Control of the sort referred to is general in belligerent countries. 77
6. Enemy Property.-Consideration of the problem of alien enemy'7 8
property demands a much fuller treatment than can be accorded it in this
article. 170 Only a few matters will be touched upon.
Under the present Trading with the Enemy Act'8 0 in this country, 181 and
in England and other parts of the British Empire,8 2 property of foreign
nationals may be vested promptly in designated agencies by issuance of a
vesting order.
In March, 1942, the President by Executive Order set up the Office
of Alien Property Custodian, the head of which is Mr. Leo T. Crowley.
It will have custody of $7,000,000,000 of alien assets frozen in this country.'83 An Alien Property Custodian system has been announced to protect the interests of Japanese, German, and Italian aliens and citizens
evacuated from the Pacific Coast. The Treasury has said that in respect
to crop-growing land an attempt would be made to lease or sell the property,
84
or to continue to give attention to the crops to prevent their loss.'
7. Property Outside the United States.-In view of the power of the
federal government to expropriate private rights in property, it follows that
if such rights exist in a place where the United States has such power, it
may be exercised no matter where the property itself may be physically
located. If the law of the situs does not prohibit, property in a foreign country
may be effectively expropriated. 85 It is believed that under the law of nations,
' 77 As to the United States, see Information Digest, April 21, 1942; as to England,
Patents and Designs Act 1942; Defence (Patents, Trade Marks) Reg. No. 3 (1941) ;
HAILSHAI, LAWS OF ENGLAND (1941 Supp., Patents) p. 11 and 111329. As to South
Africa,
see (1940) 3 ComP. L. SERIEs 401.
178 1n respect to the last world war, it has been said that
"The test of liability to seizure was not the citizenship or nationality status of the
owner, but rather the status of ownership with respect to possibilities of enemy
control. The property of enemy aliens interned, of persons residing in enemy countries, or territory occupied by the enemy, regardless of citizenship, and of persons
outside the United States doing business within enemy territory, was taken over."
HANDBOOK
OF EcoNomIc AGENCIES OF THE WAR OF 1917, 21.
179 The subject is discussed at length in Parry, The Trading with the Enemy Act and
the Definition of an Enemy (1941) 4 MOD. L. REv. 160; Bender, Practical Aspects of
Foreign Property Control (1941) 19 N. Y. U. L. Q. REv. 1. See EXPROPRIATION OF
PROPERTY FOR NATIONAL DEFENSE (Lands Division, Dep't of Justice, 1940) 72 et seq.
5
' OPub. L. No. 354, 77th Cong., 1st Sess., amending The Trading with the Enemy
Act8 1 of 1917. A number of vesting orders have already been issued.
1 See 7 Fed. Reg. 2678, 2922 (vesting orders).
182 This is true in the colonies of Great Britain as well as the mother country itself.
'8 3See
Information Digest, March 11, 1942, p. 3.
4
18 1bid. The Federal Reserve Bank of San Francisco, along with several branch
offices, has been designated to protect such alien property.
185Cf. Olympia Shipping Corp. v. United States, 71 Ct. Cls. 251 (1930), cert. denied,
284 U. S. 680 (1932) (a ship loading in Greece). The Shipping Board telegraphed
owners in New York that the use of the ship is "hereby requisitioned" and that the
Board would take possession of the vessel through the American Consul at Piraeus.
CORNELL LAW QUARTERLY
[Vol. 27
a nation could expropriate the property of its nationals anywhere, subject to
treaty provisions and to the law of the place where the property is located.18 6
7
Furthermore, the United States could acquire lands in another country,'18
and conversely, permit a foreign country to acquire, by purchase or expropriation, land or other property here. 8 8 Such acquisition is not prevented
by the fact that full sovereignty would not attach to the property acquired. 18 9
Acquisition of property in an allied country, or acquisition of property in a
non-belligerent country for war purposes, if acquired with the consent of such
country which considered the acquisition as a means of its own defense, 90
could hardly be considered a violation of international law.' 91
There have been a number .of instances where nations have entered into
agreements concerning the use of and jurisdiction over lands In another con186
As to movables, this position was taken by Senator King, 64 CONG. REc. 5283.
It has been advanced as a theory to justify not paying for property taken from enemy
aliens whose claims were abandoned by Germany in her post-war treaties, see Armstrong,
The Confiscation Myth (1923) 9 A. B. A. J.489.
'8 tThe acquisition of bases in British Colonies is an outstanding example. And cf.
Reno, The Power of the President to Acquire and Govern Territory (1941) 9 GEo.
WASH. L. REV. 251. See 5 Mooa.'s DIGEST OF INTERNATIONAL LAw 212-213 (Sulu);
Lindley, THE AcQuIsmIoN AND GOVERNMENT OF BAcKWARD TERRITORY IN INTERNATIONAL
8 LAWV (1926) c. 25; (1940) 34 Am. J. INT. L. 680, et seq.
8 Cf. Anderson v. Transandine Handelmaatschappi, 28 N. Y. S. (2d) 547 (1941).
A number of foreign countries own realty in this country, unofficially as well as officially.
As to intangibles, the United States by treaty has permitted foreign countries to expropriate debts due citizens, the United States assuming the burden of paying for such
expropriation. This was true of the claims arising from the acquisition of Florida by
the United States, Meade v. United States, 76 U. S. 691 (1870). Compare the Act
of November 10, 1803, 2 Stat. 247, making provision for payment of claims of citizens
of the United States against France, assumed by the United States under a convention
with France. For a similar arrangement with Great Britain in respect to world war
claims, see Treaty Series No. 756. See also 38 Ops. ATr'Y GEx. 322 (1935). Cf. The
Sapphire, 11 Wall. 164 (1870).
89Cf. 29 Ops. An-ey GEN. 269, 270-271 (1911), "It may be assumed that a sovereign
state cannot acquire property anywhere without impressing it to some degree with its
own attributes of sovereignty, from which a state cannot wholly divorce itself. But
when property is acquired by one state in another state by virtue of a treaty, any
sovereignty which may attach to the property so acquired is limited by the terms on
which, and the purposes for which the property was acquired, and only displaces the
plenary sovereignty of the dominant state to that limited extent. There seems to be
nothing in reason or in law which prohibits such a situation. It occurs in, and is
illustrated by, the cases in which the United States owns land in one of the States
of the Union with cession by and consent of the- State." Compare the position of the
United States upon acquiring realty in a state without its consent, 38 Ops. ATT'Y GEN€.
341 (1935). Cf. Treaty Series No. 655 [United States mission lands in Siam (Thailand)
subject
to eminent domain by Siam].
190 Ithas been done. See Foreign Policy Bulletin, March 13, 1942. In Wilson, Leased
Territories (1940) 34 Aas. J. INT. L. 704, reference is made to the negotiation by the
United States with Nicaragua in 1914 of a 99-year lease of Great Corn and Little Corn
Islands, with a right to maintain a naval base on the Gulf of Fonseca.
'M1It is commonplace. For a very recent instance, see (1942) 6 DE"T OF STATE BULL.
448. Cf. Procl. No. 2536, 7 Fed. Reg. 301.
1942]
PROPERTY UNDER A WAR PROGRAM
tracting nation,'192 and the United States has had the states 93 and other
nations 94 acquire property within their boundaries for the use of the federal
government.
8. Scrap.-Since the outbreak of the war a good bit of "scrap" has been
requisitioned in this country. As to some of this scrap the articles taken are
substantially unusable in their condition at the time they are taken. An
interesting question might arise as to whether idleness, either voluntary or
forced, could make otherwise useful property scrap for purposes of a requisftioning order issued to acquire "scrap."
Although the British Government is anxious to acquire -scrap,1 95 the
Minister of Works has asserted that there is no intention to take as scrap
valuable machinery and plants which must be preserved for use after the war.
This machinery and the plants closed down under concentration schemes
approved by the Board of Trade will not be requisitioned. 196
9. Intangible Property.-In this and in the last world war contract rights
have been taken by the government, and it is clear that such rights may be
requisitioned or condemned. 197 Under the war power of the government,
the fact that the promissor's promise involves personal services would not
necessarily prevent the taking from being effective,198 and the contract rights
taken may be such as exist between third persons, 9 9 or between the govern200
ment and a third person.
' 9 2See 4 MALLOY, TREATIS, 4261 et seq. LINDLEY, THE: AcQuIsMoN AND GovsRNor BAckwARD TEmTORY iN INTERNATioNAL LAW (1926) c. 25. Some instances
in which the United States was a party to such an arrangement: with Great Britain
as to North Borneo; with Panama as to Panama. The agreements with Panama were
extraordinary in that they allowed the United States to expropriate property within
the jurisdiction of Panama, when such expropriation should be necessary for the Canal,
33 Stat. 2234 (1905). This right was abrogated by a recent treaty, 53 Stat. 1807 (1939).
193At one time it was common for the government to condemn land in state tribunals,
and there is at least one such reported instance arising out of the last world war. See
Nichols, The Meaning of Publkc Use in the Law of Eintnent Domain (1940) 20 B. U.
L, 94
REv. 631, 639 et seq.
1 E.g., Treaty Series No. 757 (France to acquire sites for monuments to be erected
in 0France
by the American Battle Monument Commission).
1 5See (1942) 86 SOL. J. 38; Reg. 56aaa (power to require information in respect
to scrap). Subject to exceptions made in the order, scrap is defined to include metal
which is or forms part of anything disused, obsolete, redundant, or is spare or otherwise
serves
no immediate purpose.
190
See (1940) 86 SOL. J. 39. Returns of information from such firms are not required.
197S. S. Corp. v. United States, 73 Ct. Cls. 18 (1932). DeLuca v. United States,
84 Ct. Cls. 217 (1936). An order to furnish commodities is an exercise of eminent
domain,
Liggett & Myers v. United States, 274 U. S. 215 (1925).
8
19
See order in Consorzio Veneziano v. United States, 64 Ct. Cls. 11 (1927).
09
1 Brooks-Scanlon Corp. v. United States, 265 U. S. 106 (1924); De Laval Steam
Turbine
Co. v. United States, 284 U. S. 61 (1931).
20
Nortz v. United States, 294 U. S. 317 (1935).
MNT
CORNELL LAW QUARTERLY
[Vol. 27
There seems no reason why things not in esse could not be requisitioned,
nor why the requisition could not be conditioned upon the existence of certain
factors at the time when title or possession or control is to take place. Thus
a future crop or future business services might be taken far enough in advance
to insure a farmer or a business man of an outlet for his product and to
enable him to plan therefor.
B.
The Nature of the Possessor
1. Courts.-By statutes or by international law, domestic courts may be
given exclusive jurisdiction over certain property, including its disposition.
Assuming the continued existence of such laws in time of war, do they prevent
the executive branch of the government from taking such property by eminent
domain or under the war power? In view of the sovereign nature of the
power to take property for war purposes and the necessity of leaving to
administrative determination the time and the extent of the taking, as well
as the disposition of the property taken, it is believed that the powers of the
courts in such cases is subject to the exercise of the war power or the eminent
domain power. 201 Where this question arises, probably the courts will cooperate-with the executive branch of the government, while at the same time
endeavoring to retain vestigial elements of control not inconsistent with the
exercise of the power to take property.2 0 2 Requisition by the government will
20 3
not require an abandonment of forfeiture proceedings by the government.
In England, ft has been held that a belligerent power has the right under
international law to requisition vessels or goods in the custody of its Prize
Court.204
2. The Sovereign.-The fact that an interest in property has been acquired
by the sovereign, by purchase or by eminent domain, will not prevent an
exercise of the power of eminent domain to take a greater interest. 205 Where
the administrative officials are empowered to dispose of property, as well as
to take property, it would seem that they could take a lesser interest than the
one originally acquired.2 0 6 But questions of liability and just compensation
2
°TCf. International Harvester Co. v. United States, 72 Ct. Cls. '707 (1931) ; The
Pietro
Campanella, 41 F. Supp. 656 (D. Md. 1941).
2
°2E.g., Ex parte Whitney Steamboat Co., 249 U. S. 115 (1914) ; The Villarperosa,
43 F. Supp. 140 (E. D. N. Y. 1942). The United States had requisitioned the vessels
after
203 having brought forfeiture proceedings.
The Villarperosa, 43 F. Supp. 140 (E. D. N. Y. 1942). Cf. The Pietro Campanella,
41 204
F. Supp. 656 (D. Md. 1941).
The Zamora [1916] 2 A. C. 77. The court said this right was subject to several
conditions
such as determination of necessity by the court.
205
This occurs occasionally when a leasehold interest has been taken and it is desired
to 20take a fee.
6Cf. Russell v. United States, 261 U. S. 514 (1923) (cancellation of a government
contract).
1942]
PROPERTY UNDER A WAR PROGRAM
may effectively prevent the taking of a lesser interest and may be troublesome
factors when a greater interest is taken."°7
Congress has often authorized the President to make use of public lands
for war purposes or to transfer their use from one government agency to
another.208 tven without such express authority the President has exercised
this power, and although his Attorneys General have blown hot and cold on
this question, the latest pronouncements of the Attorneys General20 9 and of
the Supreme Court1 0 appear to furnish ample support for its exercise. A
good deal of public land has been made available for war purposes.2 11 In the
spring of 1941, the Secretary of the Interior announced that more than
8,100,000 acres of public lands have been taken for military and naval pur21 3
poses..2 12 Transfers of personal property also have been made.
Not without considerable protest on the part of the states, it has become
settled that the eminent domain power of the Federal Government extends
to property of a state, 14 and this power in administrative officials may be
found in a general authorization by Congress of the exercise of eminent
domain.2 1 5 No police regulation of a state or a political unit may prevent the
exercise of the federal eminent domain power for a purpose inconsistent with
the regulation. 216 However, the mere taking and use of realty by eminent
207Cf. United States v. 5 Acres of Land in Suffolk County [D. Mass. (1942) un-
reported].
208
E.g., 34 U. S. C. § 523. Cf. 16 U. S. C. § 473; cf. 41 Stat. 130 (interchange of
property between Army and Navy).
20938 Ops. ATr'y GEN. 293 (1935).
Cf. 40 Os.ArT'y GEN. No. 20, June 4, 1941.
21
OThe Sioux Tribe of Indians v. United States (Sup. Ct. No. 798, May 11, 1942);
United
211 States v. Midwest Continental Co., 236 U. S.459 (1914).
E.g., Ex. Order 2646; Ex. Order 8337, 5 Fed. Reg. 594; Ex. Order No. 8616,
5 Fed.
212 Reg. 5215 (Palmyra Island) ; Ex. Order 8821, 5 Fed. Reg. 3529.
See (March 4, 1941) 2 DEFENSE 13. By Executive Order No. 9029, January 20,
1942, 7 Fed. Reg. 443, January 22, 1942, the President withdrew public lands in New
Mexico for the use of the War Department as a general bombing range. The order
recites that the areas described, including both public and non-public lands, aggregate,
1,249,904.36
acres.
213
Ex. Order 8798, 6 Fed. Reg. 3049 (ships). Cf. Ex. Order 9088, 7 Fed. Reg.
1775-7;
Ex. Order 9133, 9114, 9121, 9160.
214
Oklahoma v. Atkinson Co., 313 U. S.508 (1941) ; United States v. Wayne Country,
252 U. S.584 (1920), aflrjinig, 53 Ct. Cis. 417 (1918) ; State of Minnesota v. United
States, 125 F. (2d) 636 (C. C. A. 8th 1942); United States v. 40 Acres of Land in
Jefferson County, 24 F. Supp. 390 (D. Idaho, 1938). This power is exercisable through
condemnation proceedings brought in a district court. See State of Minnesota v. United
States,
mtpra.
215
United States v. 60 Acres of Land in Williamson County, 28 F. Supp. 368 (E. D.
Ill.
1939). As to the extent of such implication, see FEDERAL EMINENT DomAIN (Dep't
of Justice, 1940) 14-15.
21OCf. Arizona v. California, 283 U. S.423, 451 (1931) ; Hunt v. United States, 278
U. S.96 (1928) ; State of Minnesota v. United States, supra note 214. See (1941) 23'
PUBLIC MANAGEMENT 369.
CORNELL LAW QUARTERLY
[Vol. 27
domain does not carry with it exclusive jurisdiction over the place con2
demned. 17
The power also may be exercised against the property of another country.218
C.
The Extent of the Taking
1. Title versus Use and Possessiom-As already mentioned, it has been
customary in this country to take title rather than use and possession of
property. Certain kinds of property and certain specific purposes for which
property may be desired might justify the taking of a temporary use rather
than a permanent interest in the nature of a fee. In the case of ships it is
generally the use (charter) of the ship which is taken rather than the title.219
Expropriation acts rarely attempt to put the former owner in a preferred
position as to the reacquisition of land or other property when no longer
needed by the government. The Requisitioning Act of October, 1941, prior
to its amendment by the Second War Powers Act, was exceptional in so
providing. In England, a few peacetime statutes have established such a
2 20
preference.
There are a number of reasons, however, why it is often advisable to take
a greater interest in the property than is actually needed. Generally it is
fairer to the person from whom the property is taken. If a fee is taken he
gets paid and knows where he stands. If a lesser interest is taken he is still
bound to the property and usually does not receive enough to try a new
venture.2 Moreover, in litigation, the government stands the risk that the
value of the temporary use will be fixed at a sum approaching its fee value.
Furthermore, if the property is injured or altered during the government's
possession, the government may be in the dubious position of paying for
2
possession plus a fee, instead of merely for a fee. 21
While a number of authorizing statutes specify the interest the United
States should acquire, others do not. In the latter event it would seem that
21
7See Laurent, Federal Areas within, the Exterior Boundaries of the States (1942)
17218
TENN. L Rrv. 328.
2 9See Information Digest, April 29, 1942, p. 607; (1940) 3 DEP'T OF STATE BULL. 338.
1 During the world war title to realty was taken by the War Department in the
amount of $16,697,000; use and occupation in the amount of $3,146,000 per annum. Title
to personalty was taken in the amount of $125,990,000; use and occupation (ships) in
the amount of $126,047,000. See GARRETT, GOvER mENT CONTROL OF PRICEs (1920)
p. 220
364 et seq.
See Report Prepared on Behalf of the Standing Committee for England and Wales
of the International Union of Local Authorities, International Congress of Local Authorities21 (Seville, 1928).
2 0f course, he may prefer to be paid for the use and occupation and still retain
.his221reversion.
'See FIRST REPORT OF THE DEFENCE OF THE REALM LOSSES ROYAL COMMIssION
(London, 1915) p. 5. Cf. Hamburg-American Co. v. United States, 277 U. S. 138
(1928) ; Hamburg-American Co. v. United States, 74 Ct. Cls. 360 (1934).
1942]
PROPERTY UNDER A WAR PROGRAM
the extent of the interest to be taken should be left to administrative discretion.2 22 It is for the Secretary of War or other officer authorized to acquire
property to determine what, when, and how much property is to be acquired,
and not the courts. 22 3 It is not necessary to have prior negotiations even
though state law should so require.
224
Where there is a taking without condemnation proceedings, and without
specification of the interest taken, in suits for just compensation it has been
said that "such a right or interest will be deemed to pass as is necessary fairly
to effectuate the purpose of the taking. '225 It may be doubted whether such
a rule would be strictly invoked in a case where (1) the power to take a
greater or lesser interest than the above standard existed; where (2) at the
time of the suit it would not be detrimental to the government to have an
interest different from that necessary to effectuate the purpose desired at
the time of the taking; and where (3) the equities of the claimant called for
a different interest to be found than that fixed by the quoted language.22 6
To avoid such a situation, the government needs to be careful to specify in
its petitions for condemnation and in its requisitions the nature of the interest
taken.
The Declaration of Taking Act provides for the taking of any land or
easement or right of way in land. 227 Over a long period of time this .Act has
been administratively construed to include the right to take less than a fee,
and many condemnation suits have proceeded on this basis. This construction
is in line with the recognized view that a taking of less than a fee is compensable, and that it is within administrative discretion to determine the
229
extent of the taking. 228 Leasehold interests, qualified fees, and easements
have frequently been condemned, and while the taking of title is common,
230
the taking of a lesser interest is not uncommon.
222Cf. Oakland Club v. South Carolina Public Service Authority, 30 F. Supp. (E.D.
S. C. 1939), aff'd, 110 F. (2d) 84 (C. C. A. 4th 1940) ; United States v. Forbes, 259
Fed. 585 (N. D. Ala. 1919), aff'd sub om., Forbes v.United States, 268 Fed. 273
(C. C. A. 5th 1920); United States v. Certain Lands in Town of Narragansett, 145
Fed. 654 (D. R. I. 1906). But a number of cases hold that under such circumstances
only that interest can be taken which is necessary to accomplish the desired purpose.
E.g., Thomison v. Hillcrest Athletic Ass'n, 39 Del. 590, 5 A. (2d) 236 (1939). Most
of 223
such cases do not have the government as a taker.
United States v. 243.22 Acres of Land, 43 F. Supp. 561 (E. D. N. Y. 1942).
2241bid.
225
See United States v. Lynah, 188 U. S.445 (1903).
2261f the interest desired is not expressed by the administrative officer making the
taking it is 'difficult to ask the court to seek his intention.
22746 STAT. 1421, 40 U. S.C. § 258a (1931).
228
See supra p. 35; Duckett & Co. v.United States, 266 U. S. 149 (1924).
229
Flowage easements are almost always taken in connection with river and harbor
projects.
23
OStrangely enough, at least one senator thought that Title II of the Second War
CORNELL LAW QUARTERLY
[Vol. 27
The acquiring agency, in the absence of statutory limitation or a finding
by a court 'of an abuse of discretion under the authorizing statute, is free to
choose as much of the property as it thinks desirable. Good sense and the
probability of severance damages 231 will be the only deterrents. In some
countries an option is given the owner to compel a more complete taking in
certain circumstances."
2
In Hawaiian Gas Products v. Commissianer of Internal Revenue,23 3 the
court held that condemnation proceedings amounted to a sale of property
within Section 117(d) of the Revenue Act of 1936 and loss was deductible
only to extent of $2000. One of the grounds of its decision was that the
"sovereign can get no greater title than that held by the former owner."
This statement seems clearly wrong.234 The sovereign takes the interest it
desires to take. If the owner has a mortgage or a tax lien or a doubtful title.
the sovereign can and does take a fee simple absolute, free and clear of all
23 5
encumbrances.
VII.
A.
THE RIGHT TO AND THE MEASURE OF COMPENSATION
2 35
2
The Right or Privilege
Statements- have been made and some authorities exist to the effect that
compensation is not an element of the power of eminent domain, but merely
a restriction upon that power, imposed by the constitution or other fundamental law of a state. But the view that the duty to compensate is an incident
of the power has much support.23 6 It has been suggested that only the doctrine of immunity of the state prevented early writers from finding a legally
enforceable right to compensation, rather than the moral right which they
Powers Act covered only the taking of title, and not a temporary interest. See 88
CoNG. REc. 656-657 (1942). Representative Springer thought this bill was a departure
from past enactments because he thought that previously the government always had
a fee title, 88 CoNG. REc. 1703 (1942).
condemned
231
p. 525.
2 32 See infra
See Land Acquisition Law of Jamaica (1940) § 11. Another section provides that
§ 11 shall not interfere with the Governor's power to take possession in cases of urgency.
233126 F. (2d) 4 (C. C. A. 9th 1942).
2
3For an illuminating analysis of this point, see Lenhoff, Development of the Concept
Domain (1942) 42 COL. L. REv. 596, 601 et seq.
of 2Eminent
35
Expressly provided for in the British Defence Regulations (10th ed.) Reg. No. 53,
and in the Netherlands Expropriation Law, Art. 73. See Lenhoff, supra note 234.
States v. Dunnington, 146 U. S. 338, 352-353 (1914).
United
235
'Although this section of the article uses, in good part, the language of eminent
domain
indiscriminately, most of the cases cited arose out of war measures.
23 6
Authorities pro and con are collected in FEDERAL EMINENT DOMfAIN (Dep't of
Justice, 1940) 96, §§ 18 and 19. Lenhoff, Development of the Concept of Eminent Domain
(1942) 42 COL. L. REV. 594, points out that the early natural law writers did not contemplate that this power would be delegated by a state to a non-immune entity.
507
PROPERTY UNDER A WAR PROGRAM
1942]
did find. 237 History makes it clear that whatever the soundness of this doctrine of immunity may be, compensation has been a normal incident, if not
238
an element, of the exercise of the power to take property for public use.
This power has had a history dating at least as far back as Greece. Its manifestatfons from that time on in Rome, the Netherlands, France, England, and
elsewhere have included the payment of compensation. 23 9 The constitutions
of many countries expressly provide for compensation to be paid for expropriation of property. 240 In a few countries, however, this constitutional provision is made subject to the power of the government to pass laws to the
241
contrary.
In a few countries the concept of inviolability of property rights has been
impaired by a countervailing thesis that property rights for some purposes
are held in subordination to the general welfare. 24 It has been said that in
England the Crown, in a war emergency, may take property without compensation.2 3 But, in a case arising out of the last world war, when the
237
23
Lenhoff, supra note 236.
1920) 293, relates that
during the Napoleonic Wars, certain gateways along the coasts were stopped to prevent
a threatened invasion. These gateways had been used by farmers to draw up sea weed
from the beach. When the threat of invasion had ceased, it was decided to pay compensation for loss suffered by farmers who had been unable to draw sea weed from
8ScoTr AND HILDESLEY, THE CASE OF REQUISITION (Oxford,
the2 3 9beach.
See
FIRST REPORT
1915).
(London,
240
MARiN,
OF THE DEFENCE OF THE REALm
LOSSES
ROYAL
CoMIMISSION
Cf. Jones, Expropriation in Roman Law (1929) 45 L. Q. REv. 512.
EXPROPRIATION FOR PUBLIC USE IN
THE DIFFERENT COUNTRIES,
tional Congress of Local Authorities, Expropriation of Land (Seville 1928)
Internamentions
Argentina, Cuba, Chile, Mexico, Peru, Spain, Czechoslovakia, Finland, Poland, and
Serbia. The Cuban Constitution of 1940, Art. 24, is even stronger on this point than
at the time Marin wrote. Australia and the Netherlands may be added to this list.
24 1
Art. 153 of the Weimar Constitution of 1919 provides: "Expropriation can be had
only for the common welfare and upon statutory grounds. It is had with adequate
compensation, insofar as an Imperial statute does not otherwise provide. Expropriation
by the Empire as against lands, communes and associations serving the public can be
had only with compensation."
In 1933, the Nazi law of that year relating to com-
munists gave the government the express power to issue decrees in contravention of
certain articles of the Constitution, including Article 153. Article 26 of the German
Contributions Law of 1938, as amended in 1939, contains a number of interesting provisions for indemnification and compensation but parazraph (1) provides: "A claim for
indemnification does not exist; (a)
if the contribution can reasonably be demanded
Czechoslovakia was said to have had a constitutional provision
similar to that of the German Constitution, MARIN, .rtpra note 240. Article 153 of the
without compensation."
Netherlands Constitution provides: "When the common weal requires that property be
destroyed or rendered useless, temporarily or permanently, this can only be done against
compensation unless the law stipulates to the contrary." The Netherlands Information
Bureau has informed the writer that compensation is uniformly required. It would
seem, therefore, that this provision merely permits a taking prior to the payment of
compensation.
242
supra note 240.
Report Prepared on Behalf of the Standing Committee for England and Wales of
the 7nternational Union of Local Authorities, International Congress of Local AuthoriMARIN,
243
CORNELL LAW QUARTERLY
[Vol. 27
Crown asserted such a right, the highest court of England held that where a
statute authorized expropriation with compensation, the King's prerogative
could not be exercised to take property even for war purposes without
compensation. 244 There is a practically unbroken series of precedents to show
that compensation has been incident to a taking for war purposes, whether
under the King's prerogative or under statute.245 "It may therefore be taken
as a cardinal rule of the law of expropriation that compensation must be paid
to the owner from whom the land is taken." 246 In the United States the
Fifth Amendment expresses the same principle, but even without a proviso
for the payment of just compensation, it would seem that payment of compensation would be a due process or natural law requirement 247 in view of
the almost universal recognition of an obligation to make compensation.
B.
Justification
The argument for payment of compensation generally points out that if
compensation were not made, the individual whose property was taken would
be compelled to contribute a disproportionate share to the common weal.
If he receives compensation he pays taxes thereon 248 and bears the same
burden as other taxpayers and citizens, but he is not singled out as the "goat."
The burden of public improvement or public purpose is transferred from his
shoulders to the tax-paying public at large of which he is a member. 249 But
this rationale would lead to the proposition that a general requisition of all.
automobiles or all clocks might be made without compensation, since almost
all taxpayers would be directly affected and the owner receiving payment
would, theoretically, find himself paying out a sum for someone else's automobile or clock approximating what he had received.2 0 Whether the Fifth
Amendment would permit such a taking without just compensation may be
doubted, but whether just compensation could be made in the form of being
ties (Seville, 1928).
Other statements to the same effect are collected in Cormack,
The Universal Draft and Constitutional Limitations (1930) 3 So. CALIF. L. REV. 361,
n. 71. See also, McNulty, The Power of "Compulsory Purchase" under the Law of
England
(1912) 21 YALE L. J. 639.
2 44
See Attorney General v. De Keyser's Royal Hotel, Ltd. [19201 A. C. 508. Accord,
Bradley
v. The King [1940] 4 D. L. R. 49.
245
See Scorr v. HILDESLY, THE CASE OF REQUISITION (Oxford, 1920).
24
6See supra note 243. See People v. Priest, 206 N. Y. 274, 99 N. E. 547 (1912).
24 7
See Monongahela Navigation Co. v. United States, 148 U. S. 312, 324-325 (1893).
See Grant, The "Higher Law" Background of the Law of Eminent Domain (1930)
6 Wis. L. REv. 67. See NEw YORK STATE CONSTITUIONAL CONVENTION (1938) vol. 6,
Problems Relating to Bill of Rights and General Welfare, 106 et seq. But this view
has24not
been universal, see State v. Dawson, 3 Hill 100 (S. C. 1835). See supra note 236.
8
5ee Comm'r of Internal Revenue v. Kieselbach, 10 U. S. L. WEEK 2677 (C. C. A.
3d241942).
9
See Louisville Joint Stock Land Bank v. Radford, 295 U. S. 555, 602 (1935).
25
OThe more general the requisition, the more it would look like a tax.
1942]
PROPERTY UNDER A WAR PROGRAM
relieved of the tax burden otherwise necessary to pay for the automobiles
or clocks taken from others is not so easily answered.2 x
Another pragmatic reason for the requirement of compensation is the protection it is supposed to afford against irresponsible activities of the executive
or legislative branches of the government. It is not by accident that provisions for compensation are found in the basic laws of so many countries,
rather than left to the will of the legislator or the executive.
C.
The War Power and the Fifth Anwndment
Can property be taken in time of war for war purposes without payment
of compensation? The courts in this country have never been confronted
with the situation where reasonable men would agree that it was absolutely
necessary for the prosecution of the war that property be taken without an
obligation to pay compensation. If this unlikely case were to arise, this writer
does not believe that the Supreme Court would allow the Fifth Amendment
2
to bar the way.
But this does not mean that the government can validly assert that by
virtue of its war powers it may take property without just compensation.
The Supreme Court in a number of decisions has held that the Fifth Amendment was applicable to wartime expropriations, 258 and it appears to be a
generally accepted principle in this and other countries that wartime takings
are compensable.2 54 Whether acts which would constitute a "taking" in time
of peace will necessarily be a "taking" in time of war has been left in some
doubt by the Supreme Court.2 55
It may be doubted whether just compensation can be considered an unvarying concept. Aside from variations in the views of individuals, such as
juries and judges, as to what is just compensation for the same piece of
property, there may be a change in the conception of what is just compensation according to the year in which the expropriation takes place. It is
believed that there is no immutable principle of law which prevents the courts
from sanctioning this change of conception.2 6 Therefore, although just
251
See
25 2
infra p. 514.
See Legal Tender Cases, 12 Wall. 457, 541 (1870) ; EXPROPRIATION OF PROPERTY
FOR NATIONAL DErxNsE (Lands Division, Dep't of Justice, 1940) 89-90.
2
=United States v. New River Collieries, 262 U. S. 341 (1923). See United States
v. 2McIntosh,
2 F. Supp. 244 (E. D. Va. 1932).
54
z n respect to this war it has been observed that the laws of the following foreign
countries have provided for compensation where property is expropriated for war purposes: Belgium, British Commonwealth, France, Greece, Germany, Italy, and the
Netherlands. In all probability, more could be added to this list. Cf. Official decree
of the Reichskommisar requisitioning blankets in occupied Norway, Inter-Allied Review,
November
15, 1941.
255
See Portsmouth Co. v. United States, 260 U. S. 327 (1923).
25 0
See Matter of City of New York 284 N. Y. 48, 29 N. E. (2d) 465 (1940)
CORNELL LAW QUARTERLY
[Vol. 27
compensation must be paid for a wartime taking, it does not follow that the
standards of value existing in times of peace must be followed in times
of war.
2 57
D. The Right to Sue and Recover
A number of state courts have held that
to the Fifth Amendment are self-executing,
nity of the sovereign from suit is not a good
however, has never taken a similar position
constitutional provisions similar
and that the doctrine of immudefense. 2 The Supreme Court,
in regard to the federal govern-
ment. 259 In view of the Fifth Amendment, however, it is clear that the fact
that an expropriation statute does not expressly provide for compensation
2 60
is immaterial so far as the right to recover compensation is concerned.
Property may be taken without prior payment where the "public faith and
credit" of the government is pledged, 2 6 1 and such pledge exists, it is believed,
where Congress authorizes a taking even though there has been no appro62
priation.
Despite the fact that in a condemnation suit the right to compensation is
never thought of except as one based upon the constitution, the Supreme
Court has permitted considerable confusion to creep in as to the basis of
the right to compensation where there has been a requisition. In Tucker Act
suits, even though the Tucker Act expressly permits suits against the United
States based upon a constitutional right, on a number of occasions, the
Supreme Court has talked as if the right to just compensation was based
upon another proviso of the Tucker Act-recovery upon a theory of implied
contract.263 On occasion the Supreme Court has preferred to rest the right
(reduction, in the depression era, of interest rate to be paid in eminent domain proceedings).
257
Ordinarily it will be followed because of the difficulty of determining what other
standards to use, and the absence of any general recognition of a popular change in
value
25S concepts. Limitation of wartime profits might test this proposition.
Rose v. State, - Cal. -, 123 P. (2d) 505 (1942) and cases cited therein.
2,09Cf. Langford v. United States, 101 U. S. 341 (1879).
26011 re Rugheimer, 36 Fed. 369 (E. D. S. C. 1888) ; Hamburg-American Can Co.,
74 Ct. Cls. 360 (1934). Cf. Shoshone Tribe v. United States, 299 U. S. 476 (1937).
For
a similar rule in England, see Bradley v. The King [1940] 4 D. L. R. 49.
2 1
6 United States v. McIntosh, 2 F. Supp. 244 (E. D. Va. 1932).
202
When the Second War Powers Act (Pub. L. No. 507, 77th Cong., 2d Sess.) was
being debated in the Senate, Senator Taft raised this question. No one was willing to
answer in the negative and there was a general feeling that the President could be
relied3 upon to act properly, 88 CONG. 1Ec. 691 (1942).
26 United States v. North American T. & T. Co., 253 U. S. 330 (1920); United
States v. Buffalo Pitts Co., 234 U. S. 228 (1916) ; see Klebe v. United States, 263
U. S. 188, 191 (1923); Tempel v. United States, 248 U. S. 121, 129 (1918). See
Lenhoff, Development of the Concept of Emhient Domainl (1942) 42 COL. L. REv. 596,
608 et seq. A theory of this sort led to strange results as to the right to interest, see
International Harvester Co. v. United States, 72 Ct. Cls. 707 (1931),
the Jacobs case, infra note 264.
decided prior to
1942]
PROPERTY UNDER A WARPROGRAM
of recovery upon the constitution, 2
E.
4
and this seems much the better view.20 5
Who Deteraines the Measure of Compensation
In the United States, the Courts have insisted that the determination of
the measure of compensation is a function of the judiciary. 26 6 What is meant,
however, is that if a claimant so desires he may have this question decided
by the courts. A legislative practice, inspired in the last and followed in this
world war, where a taking has been had without condemnation proceedings,
is to have the amount of compensation determined by administrative officials,
with a right to accept part of the amount offered and sue for whatever additional amount it is thought just compensation requires. This procedure is
usually provided by statute. Of course, where property is acquired by voluntary purchase, the amount of compensation is determined by the dickering
and not the judicial process.
To determine compensation a jury trial is not necessary for the taking of
property by requisition, nor is it necessary, under the Constitution, 267 in
2 68
condemnation proceedings by the United States.
The Conformity Act 269 has been thought to require the federal proceedings
to be conducted along the lines of state procedure-a requirement which has
proved quite unsatisfactory to the federal government and has resulted in a
multitude of methods of trial: juries, commissioners, and courts. Recently,
however, some federal courts have departed from a strict adherence to the
Conformity
2 70
Act.
The Tucker Act 2 71 gives the Court of Claims and the District Courts
jurisdiction to hear claims against the United States arising out of authorized
expropriations of property. Besides this permanent act, a number of the war
2 64
Cf. Jacobs v. United States, 290 U. S. 13 (1933); Phelps v. United States, 274
U.265
S. 341 (1927) ; see United States v. Lynah, 188 U. S. 445, 472 (1903).
See Rose v. State, - Cal. -, 123 P. (2d) 505 (1942). The implied contract theory
was rejected in Bradley v. The King [1940] 4 D. L. R. 49. See also Central Control
Board
2 0 v. Cannon Brewery Co. [1919] A. C. 744, 752.
United States v. New River Collieries, 262 U. S. 341, 343 (1923); Seaboard Air
Line R. Co. v. United States, 261 U. S. 299, 304 (1923); Monongahela Navigation Co.
v. United States, 148 U. S. 312, 327 (1893) ; United States v. McIntosh, 2 F. Supp. 244
(E. D. Va. 1932). In National City Bank v. United States, 275 Fed. 855 (S. D. N. Y.
1921), aff'd on other grounds, 281 Fed. 754 (C. C. A. 2d 1922), cert. denied, 263 U. S.
726 (1924), the court refused to follow the basis of valuation fixed in an executive order.
267It may be required where Congress requires conformity to state condemnation
proceedings, 25 STAT. 352, 40 U. S. C. § 258 (1888), or where a statute confers jurisdiction
26 8 on the district court to hear expropriation claims only.
United States v. Kenesaw Mountain Battlefield Ass'n., 99 F. (2d) 830 (C. C. A.
5th 1938); United States v. Hess, 71 F. (2d) 78 (C. C. A. 8th 1934). See United
States v. Jones, 109 U. S. 513, 519 (1883).
26925 STAT. 357, 40 U. S. C. § 257 (1888).
270
See United States v. 243.22 Acres of Land in Village of Farmingdale, 43 F. Supp.
805 (E. D. N. Y. 1942).
27143 STAT. 972 (1925), 36 STAT. 1136 (1911), 28 U S. C. §§ 41(20), 250(1).
CORNELL LAW QUARTERLY
[Vol. 27
expropriation acts designate courts in which the disgruntled owner may
press his claim. Usually, but not always, the reference to these courts is
similar to that in the Tucker Act.
There is considerable justification for the courts to take upon themselves
the final determination of just compensation. The legislature is not in a
position to make individual determinations. The executive branch of the
government when it takes property might be tempted to act like any other
272
buyer who has the power to fix his own price.
In general, in other countries, the method of determining compensation for
wartime takings, when there is a disagreement as to the amount of compensation, is to have an initial determination by an administrative tribunal with
a right of ultimate determination by a judicial court; departures from this
procedure, however, are not infrequent. In Germany, the Contributions Law
provides for an administrative determination and an administrative review,
but no recourse to the courts is allowed.2 73 In France, the law of November
28, 1938,274 provided for an evaluation commission to sit in each department. 275 The requisitioning authority was not required to follow the recommendation of this commission, but bad to report its reasons to a higher
authority if it did not. Resort t6 the courts was provided for. In England,
a special compensation tribunal was set up by the Compensation Defence Act
of 1939, but under the Defence Regulations, for some kinds of taking, a
distinctly different method for ascertaining compensation has been estab276
lished.
In 1939, a Defence Powers Compensation Committee was appointed upon
which are representatives of the financial agencies of the government as well
as representatives of the requisitioning bodies. The Committee appointed a
legal sub-committee and a valuation sub-committee. This Committee has
considered questions concerning the interpretation and administration of the
Compensation Defence Act, and this has made for uniformity in the treatment
of claims.2 77 The valuation staff of the Inland Revenue is frequently used in
2 72
Most of the acquisitions of the government are obtained by voluntary agreement
and the price is eminently fair, but where a disagreement reaches the courts, the owner
is 2wont
to get more than the rejected offer, although less than what he demanded.
7
The Weimar Constitution, Art. 153, provides that: "In case of dispute about the
amount of compensation the ordinary courts are to be open for relief, insofar as Imperial
statutes do not otherwise provide."
274C. 2.
275§ 41. It consists of an equal number of representatives of the public administration
and of the economic, industrial, commercial, or agricultural groups. Special evaluation
commissions
could be set up for certain categories of property, such as ships.
27
6E.g., S. R. & 0. No. 381 (1942).
2 77
Report of Mr. John W. Morris on the requisitioning of land and buildings and the
operation of the Compensation (Defence) Act of 1939, Cmd. 6313 (1941).
1942]
PROPERTY UNDER A WAR PROGRAM
determining compensation 278
In Australia, in 1939, a Defence Impressment Order provided for the
impressment of animals or things for defense purposes by purchasing offices,
and set up a compensation board to deal with claims for compensation. In
December, 1941, the Order was amended to provide for an assessment committee in addition to the compensation board. Recently a code of compensation has been issued which provides for appeals to courts of competent
jurisdiction.2 7 9 Prior to this codification there was considerable variation
from one regulation to another in the methods of determining compensa281
tion. 280 Apparently some variation still exists.
In Canada the typical provision as to determination of compensation in
respect to property taken by a controller, is that it is to be determined by
the controller with approval of the Minister, or upon reference by the Minister,
by the Exchequer Court.
F. Medium of Payment
Must compensation be payable in money? The Constitution merely says
that just compensation must be given. There are rather impressive statements
by the courts, however, that it must be paid in money. 28 2 Since ordinarily
money is the only medium which enables one to make good his loss, there
is much justification in this rule. It has the further advantage of preventing
payment being made in bonds or securities which may be of varying soundness. To avoid this latter possibility, the Cuban Constitution expressly provides for payment in cash.28 3 Moreover, the valuation process probably would
be exceedingly more difficult than it now is if barter were substituted as a
measure of value. In other countries it is generally provided that compensa284
tion is to be paid in money.
278lbid.
279
See (1942) 15 AusT. L. J. 259.
28
OCf. Reg. 54 (taking possession of land by suit in court) ; Reg. 57 (taking property
other than land by suit in court, or as otherwise specified in the Minister's order).
281S. R. No. 18 (1940) (Cold Store Regulation, as the Governor-General directs);
S. R. No. 65 (1940) (dried fruits, as Minister of State for Commerce determines);
S. R. No. 176 (1940) (at price agreed upon or at price determined by Commonwealth
Prices Commissioner after a hearing) ; S. R. No. 96 (1939) (Wheat Acquisition
Order, as the Minister of State for Commerce, on the recommendation of the Australian
Wheat Board, determines). The Minister need not make a determination until a sufficient quantity of any wheat acquired by the Commonwealth has been disposed of, to
enable the Board to make a just recommendation; but the Minister has discretion to
make
2 82 payments on claims prior to such determination.
01son v. United States, 292 U. S. 246, 255 (1934); De Luca v. United States,
8428Ct. Cls. 217, 245 (1936).
3Cuban Constitution of 1940, Art. 24.
See MARIN, EXPROPRIATION FOR PUBLIc
2 84
USE IN THE DIFFERENT COUNTRIES, Congress of Local Authorities, Expropriation of Land (Seville, 1928).
[Vol. 27
CORNELL LAW QUARTERLY
There may be occasions where the courts might permit some deviation
from this rule.28 5 Whether there should be the same rule in respect to
government obligations as there is in respect to private or municipal obligations is arguable. Payment in government bonds which are negotiable might
well be an acceptable medium of payment in certain instances, especially those
which are redeemable in a short time. If there were a general law that a
certain percentage of all capital should be loaned to the government, it is
believed that an award could be paid partly in cash and partly in bonds.
If, because of immediate governmental needs, an automobile is taken from
someone in New York, the Government could restore to him a similar automobile from its surplus stock held elsewhere, providing there was no substantial change in his position. If title has not been taken, and if the government damages property in such a way as to justify the finding of a compensable damage, the government should be entitled to exonerate its liability
by replacing or repairing the property within a reasonable time.2
86
Certainly if an owner consents, the government should be able to pay him
something other than money and to exercise its power of eminent domain
to acquire the substitute item.2 7 It may be noted, further, that special benefits
resulting to untaken portfons of the same tract of land may be considered
288
as part of the compensation for that which was taken.
G.
The Problem under the Fifth Amendment
The Fifth Amendment provides:
"... nor shall any person ... be deprived of life, liberty, or property,
without due process of law; nor shall private property be taken for
public use, without just compensation."
"Taken" has been the mystic word around which most of the litigation in
respect to the right of compensation has revolved. The approach has been
2
s8Cf. the arrangement in respect to Dutch ships requisitioned in the first world war
as to investment of part of the compensation in the United States and England, Report
on Negotiations Arising Out of Requisitioning of Dutch Vessels, FOREIGN RELATIONS
(Supp.
1, 1918).
2 86
See The Case of Saltpeter, 77 Eng. Rep. 1294 (1606). See infra p. 525.
28
7See Nichols, The Meaning of Public Use in the Law of Eminent Domain (1940),
20 B. U. L. REv. 651, 672 et seq. as to excess and substitute condemnation. In the first
world war, in a few instances, where dilapidated buildings were taken by the government
for billeting purposes, the government paid to the owner, with the latter's consent, a
sum lower than its appraised value because of having made repairs to the premises.
Cf. English Acquisition of Land, October, 1919 (providing for reasonable cost of
equivalent
reinstatement). See MARIN, supra note 284.
288
Bauman v. Ross, 167 U. S. 548 (1897); United States v. River Rouge Imp. Co.,
269 U. S. 411 (1926); United States v. Indian Creek Marble Co., 40 F. Supp. 811
(E. D. Tenn. 1941).
1942]
PROPERTY UNDER A WAR PROGRAM
to see whether there has been a "taking." If there is a "taking" the Constitution requires just compensation. If there is no "taking" this requirement
is absent. It is believed that over-emphasis on this approach has caused
confusion and artificiality which might have been avoided by greater attention
to what is just compensation under the circumstances.
The "no taking cases" may be divided into four kinds: (1) where there
has been a "regulation" rather than a "taking" of property; (2) when there
has been a wrongful expropriation of property-a tort for which a remedy
may lie against an offending official but not against the federal government;
(3) when there has been a rightful expropriation and "consequential damages"
are suffered; and (4) when there has been an expropriation of property but
not a "taking" because the property has been held subject to a right to take
without compensation.
1. Regulation o; Expropriation.-The courts have been troubled over
where to draw the line between an exercise of the police power and the
exercise of the power of eminent domain. 80 The Supreme Court has said
that to the extent the states could affect property rights under the Fourteenth
Amendment without liability for compensation, the federal government could
do likewise.2 90 The substantiality of the injury appears to be an important
element in deciding whether there has been an exercise of the eminent domain
power or the police power. 29 1 There are conflicting and seldom expressed
considerations in determining when the police power has been used, or when
there has been an exercise of eminent domain. On the one hand, there is
the belief that an emphasis upon the obligation to pay for injuries caused by
public measures would mean that such measures would not and could not
be carried out.292 On the other hand, there is the belief that an emphasis
upon freedom to carry out public measures without liability for compensation
would emasculate the Fifth Amendment and encourage a resort to regulation
293
as a means of taking without payment.
In wartime, of course, the number and types of control over property rights
are greatly augmented. The result has been that when a property owner
289See Abels, Price Control in War and Emergency (1942), 90 U. oF PA. L. REV. 675.
290
Hamilton v. Kentucky Distilleries, 251 U. S. 146 (1920).
Penna. Coal Co. v. Mahan, 260 U. S. 393 (1922): "The general rule at least is,
that while property may be regulated to a certain extent, if regulation goes too far it
will be recognized as a taking."
-92See Pine Hill Coal Co. v. United States, 259 U. S. 191, 196 (1922).
2-3This possibility is not imaginary. In Miramar Co. v. City of Santa Barbara,
- Cal. App. -, 123 P. (2d) 643, 647 (1942), the court, in denying recovery for injury
to plaintiff's littoral lands from the construction of a breakwater by the city, said that
liability would attach only "when the damage to private property was not so essential
to the general welfare as to be justified under the police power."
291
CORNELL LAW QUARTERLY
[Vol. 27
claims a loss of property by reason of a war measure, the government cries
"regulation"--the owner, "a taking."
The present opinion seems to be that property losses suffered by obedience
294
to general regulations which are fair and equitable are not compensable.
The line between expropriation and regulation is often very misty; but in
the main, if the claimant can show no particular injury other than that
suffered by other members of the public, and no physical appropriation by
the government, a "regulation" rather than "a taking" is likely to be found. 295
Hardship suffered by a restriction on the use of property has been held not
to be a constitutional objection.2 96 In England, the Defence of the Realm
Losses Commission, 297 in its first report, stated that it was not within its power
to give relief for loss arising through the enforcement of an order of general
application; but that applicants, in order to obtain compensation, must be
persons whose business or property had been subjected to a direct and particular interference, such as would have given cause for action if between
subjects. 29 8
An attempt has been made to justify regulatory power on the theory that
the injury or destruction of property without appropriation cannot support
a claim for compensatfon. 299 As will be pointed out later, however, the
adoption of such a theory by the courts is very doubtful.3 00 Where the adverse
effect is widespread, just compensation under the circumstances might allow
little, if any, compensation since the loss would be so universal that victims
would be called upon to contribute. 01 There is perhaps a pragmatic justi294
See Abels, Price Control in Warand Emergency (1942) 90 U. OF PA. L. REv. 675,
676; Freund, The Emergency Price Control Act of 1942; Constitutional Issues (1942)
9 LAw AND CONTEMP. PROBLEMs 77; Ginsburg, The Emergency Price Control Act of
1942: Basic Authority and Sanctions (1942) 9 LAW AND CONTEMP. PROBLEmS 22, n. 24;
Brief of Office of Price Administration, Hearings before H. Cont. on Banking and
Currency on H. R. 5479, Pt. 1, 77th Cong., 1st Sess., p. 220 et seq.; Note, Legal and
Economic Aspects of Wartime Price Control (1942) 51 YALE L. J. 819, 835-836; Note,
American Economic Mobilization (1942) 55 HARV. L. REv. 427, 488. When the priorities
warrants bill for vessels was before Congress, an attempt was made to include a provision for just compensation. The United States Maritime Commission filed a statement in which it advanced the distinction between a regulation and a taking, see Hearings
before
295 S. Coin. on Commerce on H. R. 4700, 77th Cong., 1st Sess., pp. 45-47.
See EXPROPRIATION OF PROPERTY FOR NATIONAL DEFENSE (Dep't of Justice, 1940)
Ch.\ VIII, F. Feltz v. Central Neb. Power & Irr. Dist., 124 F. (2d) 578 (C. C. A.
8th2961942) (even though damages are greater in degree).
Ruppert v. Coffey, 251 U. S. 264 (1920).
29
7See infra p. 523.
29
SThe Third Report of the War Compensation Court (1921-1923) enumerates some
of the general prohibitions for which no recovery was given: e.g., prohibition of photography
in a particular neighborhood.
299
See
Abels, supra note 294.
30
GSee infra p. 524.
301
See Duguit, Compensation for Losses of War (1919), 13 ILL. L. REv. 357, 358.
1942]
PROPERTY UNDER A WAR PROGRAM
fication for denying compensation for losses suffered by regulation. Valuation
of property to which title is taken, or valuation of the use of property, is an
everyday matter in the determination of which the courts may rely upon the
practices of the market place or traditional principles. But where neither title
nor possession is taken, recovery of compensation often becomes a highly
302
conjectural matter of determining loss.
Although case authority is not definite on this question, there are several
cases favoring the above view.30 3 There are a few judicial statements to the
contrary.3°0 It is possible that a direct and extremely burdensome regulation,
generally affecting certain property rights, would be considered "a taking."
In order to further the public interest, the government may, without liability
for compensation, forbid an owner to destroy his own property.30 5 It is
believed that a freezing order which denied the owner any right to dispose
of his property,3 06 for any considerable time, would be a taking of property
for which compensation would be required, or a depreciation of property
values without, due process which could be attacked.3 0 7 Property possessed
for the purpose of sale is of little use to the owner if he cannot sell it. Its
value lies in its saleability. However, when the government freezes transfers
of such property, it is believed that it has a reasonable time within which
to determine whether to requisition the property or' to release it for private
use,308 and that no compensation need be paid therefor. A temporary interference with property rights in the course of carrying out a public need is
not a compensable taking.30 9
30
2See
3 03
infra p. 53 et seq.
See Pine Hill Coal Co. v. United States, 259 U. S. 191, 196 (1922) ; Highland v.
Russell Car & Snow Plow Co., 279 U. S.253 (1929) ; Hamilton v. Kentucky Distilleries
Co., 251 U. S. 146 (1919); Legal Tender Cases, 12 Wall. 457, 551 (1870); De Palma
Plan Commission of Greenwich, 123 Conn. 257, 193 Atl. 868, 872 (1937).
v. 3Town
04
See Matthew Addy Co. v. United States, 264 U. S. 239 (1923); GARuRTT, GovERNMENT CONTROL OVER PuCEs (1920) 397.
3 05
Marchese v. United States, 126 F. (2d) 671 (C. C. A. 5th 1942).
SO6Cf. Amendment No. 3, to supplementary order No. N-15-B, 7 Fed. Reg. 512
which restricted the consumption of rubber without government approval.
(rubber)
307
This might result in compulsory abandonment. Query what position an owner
would be in, if he were compelled to maintain the property in good condition without
a right to dispose of it or use it himself. The R. F. C. has agreed to purchase excess
inventories of new tires and tubes for passenger automobiles frozen by rationing orders
of the 0. P. A. Some 7,500,000 tires and tubes have been frozen, out of which it is
estimated the R. F. C. will purchase up to 5,000,000. See Report of March 21, 1942,
of the Secretary of Commerce covering the War and Defense Activities of the Reconstruction Finance Corporation and its subsidiaries (March 28, 1942), 7 FoR. Com.
W 0 8KLy 6.
S Henderson v. Smith Doublas Co., 10 U. S. L. WEEK. 2598-99 (E. D. Va. 1942).
309
Transportation Co. v. Chicago, 95 U. S. 635 (1878); Osgood v. Chicago, 154 Ill.
194, 41 N. E. 40 (1894). This rule obtains even under state constitutions requiring
compensation where property is taken or damaged. Sholars v. Louisiana Highway
Commission, - La. App. -, 6 So. (2d) 153 (1942). Some Congressmen have expressed
CORNELL LAW QUARTERLY
[Vol.27
The Supreme Court has held that where one obeyed an order to divert coal
from one person to another and received from the latter the general maximum
price fixed by the Fuel Administrator, he could not recover the difference
between his contract price with the first person and the price received from
the second, even though under the applicable statute, price-fixing by the
Fuel Administrator could not affect pre-existing contracts.310 Justice Holmes
said that, "If the law requires a party to give up property to a third person
without adequate relief the remedy is, if necessary,, to refuse to obey it, not
to sue the lawmaker." The opinion does not make very good sense, since,
if the consignor had refused to make the diversion at the ceiling price, the
government would have had to requisition the coal and pay at least the contract price. Moreover, it has the effect of penalizing the person who cooperates
in the war effort.3 11 It is difficult to see why the diversion order was not a
taking, or to justify the decision on any other grounds. The government
argued in its brief that this was not a taking, and has relied upon the decision
as a holding that the effect of regulation on property rights is not compensable. Despite other decisions to the same effect,3
12
when this argument
was made by the government in a subsequent case it was rejected with this
brusque comment: "The incantation pronounced at the time is not of controlling importance; our primary concern is with the accomplishment." 31 3
In InternationalPaper Co. v. United States,314 the Secretary of War placed
an order and requisitioned water power. An agreement was then made between the supplier and the Secretary that the United States would waive
delivery on condition that the water power would be supplied to a third
the view that under the Fifth Amendment "the effect of the order of the Price Administrator freezing stocks of new automobiles and trucks was to seize and confiscate the
property of private individuals and corporations without making any provision for
compensation for the property in effect seized," 88 CONG. REc. 3583, but the Congress
as a whole does not seem to have adopted this view and it is clear that freezes thus
far31 have permitted disposition by the owner, albeit limited in scope.
°Morrisdale Coal Co. v. United States, 259 U. S. 188 (1922) ; accord, E. I. duPont
de Nemours & Co. v. Hughes, 50 F. (2d) 821 (C. C. A. 3d 1931); cf. United States
v. Carver, 278 U. S.294 (1929) ; National Surety Co. v. United States, 72 Ct. Cis. 369
(1931) (order to take on a specified cargo upon the alternative of refusal of clearance
and taking on of such cargo, is not a taking or requisitioning of the vessel). The courts
found no difficulty in reaching a similar result where the order was directed to a selling
agent, where there was no plant which could be commandeered if the order was not
obeyed. Atwater & Co. v. United States, 65 Ct. Cis. 621 (1928), cert. denied, 278
U. S. 618 (1928).
3nCf. Corona Coal Co. v. Davis, 120 F. (2d) 738 (C. C. A. 5th 1927) (when one
refused to deliver at his contract price, the Railroad Administration requisitioned the
coal). The owner then sued and recovered as just compensation more than the contract
See also Davis v. Newton Coal Co., 267 U. S. 292 (1925).
price.
31
2See supra note 310.
13
3 Davis v. Newton Coal Co., 267 U. S. 292, 301 (1925).
314282 U. S. 399 (1931).
1942]
PROPERTY UNDER A WAR PROGRAM
person. In a suit for compensation by one having a property right to draw
water for this mill, the government relied heavily on the Morrisdale case,
but Justice Holmes, speaking for a 4-3 court, held that there was "a taking."
The proper rule would seem to be that an order to deliver property to a
third person in aid of the war effort is just as much "a taking" as an order
to deliver itto the government to be transferred to the same third person.
The liability of the government in the first instance should be one of secondary
liability. It is not unusual for the government to take property to be paid
for by private persons rather than by the government. 15
In this and other countries, the denial of a right of compensation for
property losses suffered by drastic regulations does not necessarily mean that
no relief exists. In Germany, closed factories have 'been said to receive
indemnity paid- out of a levy on industrial companies still working. 16 In
the United States, there is a growing tendency to cushion the effects of
regulatory control by subsidies 317 or other compensatory devices.31 s This is
also ,true in England. 319
In Australia, provision has been made to give compensation in addition to
charter rates for certain requisitioned ships because requisitioning prevented
the recovery of losses and outgoings in the manner contemplated by the
3 20
Commonwealth Price Commissioner in exercising his price powers.
2. Tort.-The courts have construed the Fifth Amendment not to cover
wrongful takings. Therefore, in view of the immunity of the government
31 3
516
31
United States v. River Rouge Imp. Co., 285 Fed. 111 (C. C. A. 6th 1922).
THE ECONoMIST,
October 26, 1940.
7See Press Releases of Office of Price Administration, PM-3338, May 17, 1942;
PM-3347, May 19, 1942; 7 Fed. Reg. 3749, 3900 (bituminous coal) ; PM-3542, June 4,
1942
318 (charter rates).
The Inventory and Requisitioning Branch of the War Production Board has estab-
lished a schedule of prices to be paid from R. F. C. funds for raw, semi-processed, and
scrap materials founcf in possession of manufacturers prohibited by priority regulation
from using them. If dissatisfied with the price offered, the owner may allow the
materials to be requisitioned and take his chances on the compensation accorded him
by the courts.
See W. P. B. Press Release No. 784, April 6, 1942. In excepting
purchases by the Metals Reserve Co. (a subsidiary of the Reconstruction Finance Cor-
poration) of stocks of metallic nickel frozen by the nickel conservation order M-6-b,
the Office of Price Administration issued a press release, stating: "In view of the fact
that such materials have been rendered useless in the hands of their holders by war
restrictions, the W. P. B. has recommended that the Metals Reserve Company buy such
materials at prices higher than the maximums established for scrap in Revised Price
Schedule No. 8." PM 3158, May 1, 1942. Cf. Pub. L. No. 549, 77th Cong., 2d Sess.
(R.
F. C. to buy, or make loans in respect to, rationed commodities).
319
See (June 3, 1942) BuLLErrNs FROM BRITAIN, p. 3 et seq.; (1940) 21 J. OF
PARLIAMENTS OF THE EMPIRE 45. In England, concentration of non-essential industry
into the hands of a few as a result of government impetus has been thought to entail
no legal obligation to compensate those frozen out. But there is considerable feeling
that adequate relief should be given, see TIIE EcoNoMIST, February 14, 1942.
320S. R. 99 (1942).
CORNELL LAW QUARTERLY
[Vol. 27
from suit for torts, no recovery may be had against the government for a
wrongful taking, even though the owner may suffer appreciable loss.32 ' He
322
may, however, have a cause of action against the official for his tort.
3. Damages. (a) Disturbance damages.-The courts have definitely
established that just compensation does not include all damages caused by
a taking. Under the rubric "consequential damages" they have denied recovery for many types of losses.323 This position of the courts seems to be
based upon a fear of an inordinate drain on the public purse because of the
great discrepancy in the value of the thing obtained and the losses suffered,
24
and the difficulty in ascertaining subjective or highly conjectural damages.
3
2
5
326
Recovery for moving expenses,
increased expenses
in running a business in a new place, and loss from breakage in moving3 27 has been denied.
Expenses and loss suffered by an owner in not making full use of his property
pending condemnation have been held not recoverable where the United States
abandoned the proceedings and did not take possession or disturb the owner's
occupation. 328 It has been held that frustration of a contract right is not a
329
compensable taking.
32 1
in Bussey v. United States, 70 Ct. Cis. 104 (1930), a plantation was taken under
the War Purposes Act which authorized the taking of realty. A good deal of personalty
was destroyed. Held, recovery for value of land; none for personalty. It would seem
that where the government got the benefit of the use of the property, the courts should
find
322an appropriation rather than a tort. Rigsbee v. United States, 58 Ct. Cis. 43 (1923).
Sloan Shipyards v. United States Fleet Corp., 258 U. S. 549 (1922).
323
Mitchell v. United States, 267 U. S. 341 (1925) ; Chicago, Milwaukee & St. P. R.
Co.324v. City of Minneapolis, 232 U. S. 430 (1914).
Cf. Duguit, Compensation for Losses of War (1919) 13 ILL. L. REV. 357, 358. See
Report of John W. Morris on the requisitioning ,of land and buildings and the operation
of the Compensation (Defence) Act of 1919, Cmd. 6313 (1941) where, to show that
universal compensation is impossible, the following examples were put: (1) Suppose
small businessmen are called into the army; (2) Suppose there are losses from rationing
and other regulations. The present writer confesses an inability to see this impossibility,
although he admits the difficulty.
Under the French law of November 28, 1938, indemnities for the requisition of property were to include only the actual loss imposed on the day of requisition. Where only
the right to use was demanded, the owner was entitled to an indemnity taking into
account the deprivation of enjoyment imposed upon him, "which indemnity will be
settled with him at the end of each period of time fixed by the evaluation commission."
But the period was not to exceed six months.
325
Southern Products Co. v. United States, 61 Ct. Cls. 801 (1926) ; Gershon Brothers
Co.
v. United States, 284 F. (2d) 849 (C. C. A. 5th 1922).
326
Gershon Brothers Co. v. United States, supra note 325.
327
Gershon Brothers Co. v. United States, suepra note 325. Semble, where special
equipment was abandoned, Thermal Syndicate v. United States, 81 Ct. Cis. 446 (1935) ;
or loss suffered from a forced sale of personalty, Clark v. United States, 67 Ct. Cis. 388
(1929). For another "hard" case, see Carr v. United States, 28 F. Supp. 236 (W. D.
Ky.
3281919).
Shoolman v. United States, 83 Ct. Cis. 410 (1936).
329
Russell Co. v. United States, 261 U. S. 514 (1923) ; De Laval Steam Turbine Co.
v. United States, 284 U. S. 61 (1931). This last case is extraordinary in that it contains a statement by the Solicitor General of the United States that it was his personal
1942]
PROPERTY UNDER A WAR PROGRAM
33 0
While recovery is almost always denied for a loss of anticipated profits,
there is confusion as to whether anticipated profits may be considered in
determining the value of the property taken. It would seem common sense
to take the possibility of such profits into consideration, as would an ordinary
purchaser, 331 but many courts have made it difficult to introduce any evidence
33 2
thereon for fear of the speculative nature of such evidence.
Where plants, engaged wholly or primarily on government contracts, are
taken over temporarily by the government because they are strike-bound, or
for some other reason, it would seem that no compensation would be required
if the owner gets the benefit of his contracts.3 3 It would be difficult for the
plant owner to prove loss if his ability to fill the contract was doubtful before
3 34
the government interfered.
Business, as such, has not been favored in the law of eminent domain.
It is generally held that a loss of business arising from a taking of property
need not be compensated. 33 5 During the last world war the Navy Department
served notice on the owners and tenants of the Bush Terminal Model Loft
Building that it was commandeering the building. The notice stated that the
Navy Department would accept occupancy on or before December 1, 1918,
that the Department's obligation for rent would start when space was actually
vacated, and that vacation must be before December 1. In September the
Department cancelled the commandeering notice. In a series of cases, the
Court of Claims held that no recovery could be had by tenants who, after
receipt of the first notice, had entered into other leasing commitments, and
had incurred expenses for moving, legal services, title guarantees, drawing
plans for a new plant, and dismantling the business on the premises. 336 A
compensable taking does not result from an injury to property which is
benefited to a greater degree in other ways by the act complained of.337 There
opinion that the profits should be recoverable. See also, Nitro Powder Co. v. United
States,
71 Ct. Cls. 369 (1930).
33
OSee ORGEL, VALUATION UNDER EMINENT DOMAIN (1936). Cf. De Laval Steam
Turbine
Co. v. United States, supra note 329.
331
Compare Board of Chosen Freeholders v. Emmerich, 57 N. J. Eq. 535, 42 Atl. 107
(1898) with Sanitary District v. Pittsburgh, 216 Ill. 575, 75 N. E. 248 (1905), and
Stephenson
Brick Co. v. United States, 110 F. (2d) 360 (C. C. A. 5th 1940).
3 32
United States v. Carver, 278 U. S. 294 (1929); Berg v. United States, 59 Ct.
Cls. 462 (1924), appeal disnissed, 169 U. S. 535 (1925); Omnia Commercial Co. v.
United States, 261 U. S. 502 (1923).
333
3 3 4 See supra p. 495, 501.
No compensation has been paid by the War Department for the plants temporarily
taken over by them since 1940. In some instances the private owners have appreciably
benefited
by government occupation or control.
335
Mitchell v. United States, 267 U. S. 341 (1925).
336
Acme Die Casting Corp. v. United States, 81 Ct. Cls. 415 (1935) ; Thermal Syndicate.
Ltd. v. United States, 81 Ct. Cls. 446 (1935).
337
United States v. Sponenbarger, 308 U. S. 256 (1939).
CORNELL LAW QUARTERLY
[Vol. 27
would seem to be a duty upon claimants to take reasonable steps to minimize
338
the loss-arising from the requisition.
Where there has been a technical taking, but no actual control of the
property or disturbance of the owner, just compensation may not require
payment to such owner, at least where there is no showing that the owner
refrained from using the property -because he" expected momentary government interference.33 9 Where, during wartime, the government temporarily
takes possession of vacant property, it is arguable that the fiction of a willing
buyer and a willing seller should be departed from to see whether the owner
actually suffered a loss and whether, if compensation is given to him, he
would not be in a much better pecuniary position than if his property had
340
not been taken.
What to do about these "disturbance damages" has troubled the legislature
as well as administrative officials.m On several occasions proposals have been
made to permit recovery, but such suggestions have failed to show where to
draw the line and how to determine the approximate cost of a project beforehand if such damages were recoverable. 342 The government, through the
Farm Security Administration, has endeavored to help farm families who
have had to move on short rioticeM3 because of government acquisition of
land for war purposes. Help has taken the form of (1) cash grants for
subsistence and actual moving expenses, (2) loans to enable them to start
farming again, (3) loans to tide persons over, until they get paid for their
338
Claim of the Elliott Steam Tug Co., Claim No. 4, 1st Rept., War Compensation
Court (1921); Claim of Monypenny, Claim No. 17, 3d Rept., War Compensation Court
(1922).
3 39
Marion & R. V. Ry. Co. v. United States, 270 U. S. 280 (1926) ; Nevada-:CaliforniaOregon Ry. v. United States, 65 Ct. Cls. 75 (1928), cert. denied, 278 U. S. 602 (1928).
But cf. Atlantic Refining Co. v. United States, 72 Ct. Cls. 1 (1931) where the government was held entitled to earnings above the requisition rate when the owner had been
allowed
to complete certain contracts before actual control was taken.
3 40
FIRsT REPORT OF DEFENCE OF THE REALMi
LossEs ROYAL CommrssION
(London,
1915) § 8; Claim of London County Council, Fourth Report, War Compensation Court
(1923). A claim of loss from inability to sell to a purchaser at war prices because of
the occupancy of the government should fail unless the owner can demonstrate that he
desired to sell, and that if there had been no requisition, he could have sold at the price
desired,
Claim of Stranger, Claim No. 6, 5th Rept., War Compensation Court (1925).
34
In some placeg a flat percentage of the value of the property is added to compensation to cover such damages, e.g., the Acquisition of Land for Public Purposes Act of
the Bahamas. Cf. Small Holding Act of 1910, 10 EDw. VII and 1 GEO. V, c. 34, providing
3 4 2 for disturbance damages for tenants.
See as to the Second War Powers Act, 88 CONG, REc. 1691, 1694 et seq., 1709
et seq., 1839 et seq., 1832. It was felt, also, that the ordinary rules of damage should
not be departed from in time of war. A possible solution might be a special administrative fund to be available up to a certain amount for individual cases of hardship.
The War and Navy Departments have such funds for damage to property arising out
of 3 their
operations.
43
THE AGRICULTURAL SITUATION
(Dep't of Agriculture, December, 1941), states that
more than 14,000 families were thus affected.
1942]
PROPERTY UNDER A WAR PROGRAM
land by the government, and (4) aid in locating other farming land.&3
Relocation corporations were established in a number of states to purchase
farms which displaced farmers could acquire from the corporations, 45 but
3 46
the Comptroller General has ruled against the validity of such corporations.
In England, during the first world war, a commission known as the Defence
of the Realm Losses Royal Commission was created "to inquire and determine, and to report what sum [in cases not otherwise provided for] ought
in reason and fairness to be paid out of public funds to applicants .. .in
respect of direct and substantial loss incurred and damage sustained by them
by reason of interference with their property or business in the United
Kingdom through the exercise by the Crown of its rights and duties in the
defence of the Realm." Under the Indemnity Act of 1920, this Commission
became the War Compensation Court. While it construed its jurisdiction
rather narrowly,34 7 it did afford -relief in a number of instances where the
ordinary rules of compensation would have denied relief.3 43
In connection with the requisitioning of land and buildings and the operation of the Compensation Defence Act of 1939,349 in England there have been
numerous complafnts, and because of this the Chancellor of the Exchequer
had a report prepared in the fall of 1941, covering these complaints. 350 The
report denied the justness of some of the complaints, acknowledged the justness of others, and confessed an inability to suggest a remedy as to some;
but in a few instances recommended definite measures of alleviation. In
general, the major hardships arose out of dispossessed tenants still bound on
their leases. The fact that compensation was not given for loss of profits or
good will, or disturbance or expense caused by requisition, was also much
complained of. While no compensation is given for consequential damages
under this Act, the clause "expenses reasonably incurred" is liberally construed. 1
Despite some utterances to the contrary, 352 it seems clear that a right to
3 44
THE AGRICULTURAL SITuATIoN, supra note 343 at 15.
34 5 Ibid.; Report of Solicitor of Dep't of Agriculture (1941)
46
334 7 B-23881, May 18, 1942.
27.
See FIRsT REPoRT OF THE DEFENCE OF THE REALm LosSEs RoYAL CoMInssIoN
1915). See supra p. 49.
(London
34
8See Davidson, The Defence of the Realn Losses Commission and the War Compensation, Court (1923) 5 J.CoiP. LEG. & INT. L. (3d ser.) 234. Loss of profits was
held recoverable, Claim of Elliott Steam Tug Co. [1922] 1 K. B. 127. See The Second
Report of the War Compensation Court, p. 8 et seq.
349
The Compensation Defence Act of 1939 is departed from occasionally in the Defence
e.g., Reg. No. 79c.
Regulations,
&5 OReport of Mr. John W. Morris on the requisitioning of land and buildings and the
operation of the Compensation (Defence) Act, 1939, Cmd. 6313 (1941).
35
IReport, supra note 350.
352
The government took this position in Morrisdale Coal Co. v. United States, 259
CORNELL LAW QUARTERLY
[Vol. 27
compensation does not depend upon actual use of the property by the government.ms3 Destruction of property in the zone of actual combat without lia-
bility for compensation has been upheld, 35 apparently upon the basis of
tradition, 3 5 state police power analogies, and a fear of the drain upon public
funds if destruction were widespread, rather than upon the wording of the
Fifth Amendment. 356 Recognizing this exception, it is just as much a public
use to destroy property when necessary as it i's to occupy it. In fact, destruction is a use and a taking.m 7 The Constitution does not say that a benefit
measurable in money must result to the government from a taking.3 53 In
the last ten years the government has condemned millions of acres of land;
in many of them there have been buildings which the government has had
to destroy before going ahead with the project. The measure of damages
invariably is the value of the land as enhanced by the buildings. Any other
rule would mean that just compensation would be value to the taker-a
principle repudiated by the courts on numerous occasions.3 59
In several situations, again, the courts have permitted recovery for loss
in value of land where there was no physical taking of the land in question.
Loss or substantial curtailment of access to land has been held compensable.36 0
During the first world war the government issued a commandeering order
U. S. 188 (1922), and took the further position that consideration must move to the
government for the Court of Claims to have jurisdiction. The court's handling of these
contentions was not very satisfactory.
353Cf. Russell Co. v. United States, 261 U. S. 514 (1923) ; Wheeling Steel Corp. v.
United States, 74 Ct. Cis. 571 (1931) (cancellation of a contract). Cf. Clark v. United
States, 59 Ct. Cis. 940 (1924), rev'd on government's confession of error, 273 U. S. 774
(1926).
Ex. Order No. 8964, 6 Fed. Reg. 6367-6368.
354United States v. Pacific Railroad, 120 U. S. 227 (1887).
355Cf. Penna. Coal Co. v. Mahon, 260 U. S. 393 (1922).
356
Cormack, The Universal Dralt and Constitutional Limitations (1930) 3 So. CALIF.
L. REv. 361, 362, states the rule to be that a deliberate intention to damage property
(precautionary) for war purposes is compensable, but not where damage is caused by
pressing danger in the course of military operations. The distinction is often difficult
to make. Much of the doubt and confusion on this score arose out of Acts of Congress
passed after the Civil War under which the Court of Claims was prohibited from hearing
claims against the United States based upon destruction or damage to property by the
Army and Navy during the war. See Heflebower v. United States, 21 Ct. Cls. 228
(1886). The prohibition extended to the use of realty situated at the seat of war.
357"A right may be taken by simple destruction for public use." Duckett & Co. v.
United States, 266 U. S. 149 (1924). United States v. Welch, 217 U. S. 333, 339
(1910) ; United States v. Cress, 243 U. S. 316 (1917).
35SCf. Ocean S. S. Co. of Savannah v. United States, 64 Ct. Cls. 98 (1917) cert.
denied, 277 U. S. 584 (1928) ; Wheeling Steel Corp. v. United States, 74 Ct. Cls. 571
(1931) (cancellation of contracts; recovery for loss in value of materials never used
by3 the government).
59See infra p. 59.
360
Federal Real Estate Co. v. United States, 79 Ct. Cis. 667 (1934); Vandiver v.
United States, 67 Ct. Cis. 125 (1929). See also, Schiefelbein v. United States, 124 F.
(2dy 945 (C. C. A. 8th 1942).
1942]
PROPERTY UNDER A WAR PROGRAM
for the Bush Terminal in Brooklyn. The Terminal was occupied by a number
of tenants carrying on substantial activities. Upon receipt of the commandeering order, many took leases of other premises and moved or began
to move. Despite the fact that the government countermanded the commandeering order, without going into occupation, it was held that the tenants
were entitled to the difference between the market value of the lease and
the rental paid from the date the tenant moved.36 1
Imposing a servitude on property may be "a taking."36 2 The principle of
severance damages is firmly established in the law of eminent domain. If
one owns a parcel of real estate and the government takes only part of it,
he may recover not only the loss in value of the remaining tract caused by
the severance, but the loss in value caused by the presence of the expected
project.363 There should be no distinction in the case of severance damages
to personalty. Certainly if the value of the whole is greater than the value
of its separate parts, the owner should be able to recover for the loss of value
to the whole, to the same extent he may in the case of realty. Examples of
this rule applied to personalty might be the expropriation of automobile tires
and machine tools.Y Just compensation should not be one thing for realty
and another for personalty.
Where possession has been taken of property and the property is damaged,
ft would seem that the government should be required to compensate the
owner for the injury suffered,36 5 or restore the property to its proper condition, or pay the owner the cost of restoration plus the loss of time incurred
by the owners in making the repairs.36 5'
(b)
Taking for zvigatioin.-It is well settled that structures in and over
navigable streams and land within the high water mark are merely limited
property rights subject to the servitude of the federal right to destroy them
361
Andrews v. United States, 86 Ct. CIs. 282 (1938); Wm.Wrigley, Jr., Co. v. United
States,
362 75 Ct. Cis. 569 (1932).
Portsmouth Co. v. United States, 260 U. S.306 (1923).
363
United States v. Grizzard, 219 U. S.180 (1911) ; United States v. Welch, 217
U. S.4 333 (1910) ; Rasmussen v. United States, 69 Ct. Cls. 419 (1930).
M When the Second War Powers bill was being debated some Congressmen seemed
to feel that no recovery could be had for the automobile, 88 CONG. R.c. 1705. Parish
v. United States, 57 Ct. CIs. 529 (1922) supports their position. The court, in part,
relied
upon the absence of an "implied contract," see supra p. 42.
365
In West v. United States, 73 Ct. Cis. 201 (1931), the government occupied land
for a military camp and artillery range. Held, owner entitled to use and occupation
plus $79,400 for the cost of locating, excavating, and removing unexploded shells left
buried on the ground, together with interest on the total from the date of the relinquishment of the property until paymerit. But cf. M~ark Coffee Co. v. United States, 63 Ct.
Cis.
562 (1927).
3 5
'Spreckels v. United States, 63 Ct. Cis. 64 (1927). See 53 STAT. 1255, 46 U. S. C.
§ 1242 (1939) (ships).
CORNELL LAW QUARTERLY
[Vol. 27
00
or curtail their use for the promotion of navigation, without compensation. 67
It does not matter that the navigational improvement is for war purposes.
The open market.-The value of personal prop4. Market Value. (a)
erty, if it has a market price, is much easier to determine than that of realty
since, although realty may have a market value, it is rarely traded in enough
to have an observable market price. Furthermore, almost always, the interest
taken in personalty is the fee title or its use, but some interests in realty taken
by the government defy the imagination of the court or jury called upon to
68
evaluate the interest taken.
The general, but not invariable, rule in the law of eminent domain is to
69
The
use market value as the standard for determining just compensation
price is that which would be determined by a hypothetical willing seller and
a hypothetical willing buyer,. 70 considering all the uses for which the property
is reasonably suitable. 371 Neither value' to the taker,8 7 2 nor value to the
owner is the proper test373 An owner may not show the value of the property
for defense or war purposes.8 74 A generally expressed rule is that the owner
should be put in as good a pecuniary position as if his property had not been
3 76
"Just
taken 3 75 Even this latter rule, however, is often departed from.
compensation" is not a matter of static definition.
66
3 United States v. Chicago, M. St. P. & P. R. R. Co., 312 U. S. 592, 313 U. S. 543
; Louisville Bridge Co. v. United States, 242 U. S. 409 (1917).
(1941)
867
Bailey v. United States, 62 Ct. Cls. 77 (1926), cert. denied, 273 U. S. 751 (1927)
(oyster beds).
68
3 The following is an interest recently taken by the government: fee simple title,
subject to public utility highways and easements, and reserving to the owners and
claimants all mineral rights, subject to the provision that 40% of the gross proceeds
from any minerals produced should be paid to the United States as royalties, up to the
amount paid by the United States for the lands.
369
United States v. New River Collieries, 262 U. S. 341 (1923) ; Olson v. United
States, 292 U. S. 246, 253 (1934). The market value test is widespread, e.g., Jamaica
Land Acquisition Law of 1940; English Acquisition Land Act, 1919. Where there has
been little sales activity or when the property is unique, reproduction cost is generally
admissible to show market value. United States v. Boston, Cape Cod & N. Y. C. Co.,
271 Fed. 877 (C. C. A. 1st 1921), but such cost is not admissible, if conditions were
such as to make it highly doubtful that anyone would reproduce the thing taken, United
States v. Boston, Cape Cod & N. Y. C. Co., spra. Cf. A. & B. Taxis v. Secretary of
State for Air [1922] 2 K. B. 328. Nor may an owner recover the cost of the property
to. him as market value. United States v. Certain Lands in Town of Hempstead, 43
F. Supp. 418 (E. D. N. Y. 1939).
v. United States, 292 U. S. 246, 253 (1934).
870Olson
371 01son v. United States, szutira note 370 at 255.
2
37 United States v. Chandler-Dunbar Water Power Co., 229 U. S. 53 (1913) ; Minnesota Rate Cases, 230 U. S. 352, 451 (1913). See Hale, Value to the Taker in Convdemnation Cases (1931) 31 COL. L. REV. 1.
373
United States v. Honolulu Plantation, 122 Fed. 581 (C. C. A. 9th 1903).
374 United States v. Boston, Cape Cod & N. Y. C. Co., 271 Fed. 877 (C. C. A. 1st 1921).
873
See Phelps v. United States. 274 U. S. 341, 344 (1927); United States v. New
River Collieries, 262 U. S. 341 (1923). Sometimes loss to the owner is said to be the
of damages, Roberts v. New York City, 295 U. S. 264, 282 (1935).
measure
37 6As in the case of disturbance damages, see mipra PT. VII, G, 3, a.
1942]
PROPERTY UNDER A WAR PROGRAM
Where the taking precedes the making of the award, just compensation is
determined by the value of the property at the time of the taking.3 7 Where
the award precedes the taking, the most logical and generally the fairest rule
is that the value should be determined as of the time of making the award,
whether or not property values have fluctuated prior thereto, and whether
or not the government has commenced condemnation proceedings or taken
378
possession prior thereto.
Enhancement in market value caused by improvements is not allowed by
the courts when shown to have been made in contemplation of the taking.3 79
There is considerable authority to the effect that destruction of an illegal
structure, resulting from an exercise of eminent domain, is not compensable,38 0
but there is respectable authority looking the other way when the government
has not exercised its right to abate the illegal structure.381 Where the existence or use of property is in violation of law, it would seem that if such
property were taken, any increment in value derived from the illegality should
be disregarded. 38 2 The fact that the former owner has paid $50 for a "bootleg" tire does not mean that he can extort $50 from the government. On the
other hand, the government probably cannot use the property, and still assert
that it has no value because of the illegality.38 3 If the government has a right
of forfeiture, that right may be pressed even though the property is requisitioned. 38 On the other hand, the amount necessary to make property conform to the law might properly be deducted from the value of the property,
or only its value as property subject to abatement should be recovered.38 5
37
7Olson
378
v. United States, 292 U. S. 246 (1933).
United States v. Certain Lands in Town of Hempstead, 43 F. Supp. 418 (E. D.
N.37Y. 1939).
911 re Briggs Ave., 196 N. Y. 255, 89'N. E. 814 (1909).
3 0
S Dep't of Public Works & Buildings v. Hubbard, 365 Ill. 99, 1 N. E. (2d) 383
(1936); Kingsland v. Mayor, 110 N.. Y. 569, 18 N. E. 435 (1888); In re Neptune
Avenue in the City of New York, 254 App. Div. 690, 3 N. Y. S. (2d) 825 (2d Dep't
1938); Harvey v. L. & B. R. R. Co., 47 Pa. 428 (1864); Diedrich v. N. W. U. Ry.
Co., 47 Wis. 248 (1877). See Great Northern Ry. Co. v. Washington Electric Co.,
1973 Wash.
627, 86 P. (2d) 208, 214 (1939).
81Sanitary Dist. of Chicago v. Pittsburgh, 216 Il1. 575, 75 N. E. 248, 251 (1905);
West Chicago Park Comm'rs v. Boal, 232 Ill. 248, 83 N. E. 824 (1908); Matter of
State Reservation at Niagara, 16 Abb. Pr. (N. C.) 159 (N. Y. 1884); Northern Ry.
Co. v. Washington Electric Co., supra note 380. Cf. Monongahela Nay. Co. v. United
States, 148 U. S. 312 (1893).
38s2Cf. Kelleher v. Schoene, 14 F. (2d) 341, 345 (W. D. Va. 1926), aff'd, 278 U. S.
5633 3(1928) ; In re Pier Old No. 49, East River, 227 N. Y. 119, 124 N. E. 148, 152 (1919).
8 11 re Pier Old No. 49, East River, supra,note 382; cf. State v. Bancroft, 148 Wis.
124, 134 N. W. 330 (1912). Perhaps the nature of the illegality might have some effect
on the attitude of the courts. Cf. statement of Admiral Land in respect to sabotaged
ships, Hearings before S. Subcomm. of Comm. on Appropriations on H. R. 5412, 77th
Cong.,
1st Sess., p. 251.
38
4See supra note 202.
3=;Cf. Ranlet v. Railroad, 62 N. H. 561 (1883) ; West Chester & W. Plank-Road v.
CORNELL LAW QUARTERLY
[Vol. 27
(b) The closed nurket.-Since just compensation must be just to the
government,38 6 as well as to the property owner, it follows that a taking by
the government would not require compensation in excess of a price ceiling
established for such property if, in the absence of such taking, the owner
could not lawfully have obtained a higher price.3 s7 Under the ordinary test
of market value the owner is not entitled to greater compensation, since this
is- the generally prevailing price.
In the United Stateg there have been many attempts to regulate prices of
commodities. Price maximums were used to a substantial extent during the
last world war and have been invoked on a much larger scale during this
war. But the price of land has been left free from governmental control. In
wartime, the market value of realty is likely to fluctuate considerably. In
some places the value of property will accelerate sharply because war activities
make profitable the use of property. On the other hand, considerable amounts
of realty are likely to be damaged through war action, while many forced
sales will occur because of financial embarrassment arising from the death
or injury of the provider, or because of some government regulation. If
bombing comes to the United States and a buying and leasing pressure is
exerted in unbombed communities, a further land boom may be expected.
In Germany, the National Commissioner of Price Control and the National
Commissioner for Social Housing have applied price fixing to land.38 8 A
primary purpose of such regulation is to prevent price increases for building
land which are likely to occur in a post war reconstruction area.389
In Australia, after the Japanese entry into the war, severe price restrictions
Chester Co., 182 Pa. 40, 37 Atl. 903 (1897) ; Miller v. Huntington & Ohio Bridge Co.,
Va. -, 15 S.E. (2d) 687 (1941).
6Bauman v. Ross, 167 U. S. 548, 572 (1896).
s8sCf. Note, Legal and Economic Aspects of Wartime Price Control (1942) 51 YALE
L. J. 819, 840, n. 102. See Highland v. Russell Car Co., 279 U. S. 253, 262 (1929);
cf. Vogelstein & Co. v. United States, 262 U. S. 337 (1923) ; Corona Coal Co. v. Davis,
20 F. (2d) 738 (C. C. A. 5th 1927). Cf. Memorandum of Attorney General, H. R.
Doc. No. 264, 72d Cong., 1st Sess. (1932). But cf. Davis v. Newton Coal Co., 267
U. S. 292 (1925) where apparently "spot prices" of those not obeying Government price
regulations were used. However, it has never been clear whether authority existed for
price
fixing during the last world war in the absence of statute.
88
- 38W.
3 HEILMANN, PIISBILDUNGUND PREISIERWACHUNG BFI BANLAND, REICHSARBEITSBLATT, September 25, 1941. The basic authorization has been proclamation, No., 155/37
of the National Commissioner of Price Control of October 6, 1937; proclamation, No.
64/41 of June 10, 1941, from the same source; and a proclamation of June 10, 1941 of
the 8 National
Commissioner for Social Housing.
3 9 HEILMANN, supra note 388. In Germany, where capital goods were placed at the
disposal of the armed forces under the Contri'utions Law, it was provided, that any
receipts exceeding the book value of the goods were to be exempt from taxation and
could be set'aside in a special fund out of which replacements could be financed later on.
In 1941, tax exemption reserves were extended to farmers and foresters to take care
of soil depletion.
1942]
PROPERTY UNDER A WAR PROGRAM
were placed upon the sale of land to discourage speculative sales and new
construction.39 0 These restrictions complemented milder restrictions of an
earlier date. 391
It would seem that the effect on the market value of lawful government
restrictions on the use of property should be considered in determining its
value when taken by the government. Thus, where the sale of an article
requires a permit, that fact may be brought to the jury's attention and they
may consider this element in determining the value of the article taken.392
Fear of going into collateral issues would not justify the preclusion of evidence
as to the likelihood of procuring a permit.393 Furthermore, if wartime conditions or wartime regulations make it probable that certain types of activities
will be impossible or restricted, and the value of a property right depends
upon such activities, the government, when it takes such property, should
not be compelled to pay more than an ordinary "willing buyer" would pay
under the circumstances.3 94 There is no reason why the owner should get a
windfall by the taking. 395
But if the government fixes a price for an article at which it is to be sold
to the government, and such article is not of the kind customarily sold only
to the government, and the article is free to sell for more in the open market,
it is believed that there would be a violation of the Fifth Amendment if the
government compelled the article to be sold to it at the fixed price.3 90 In
390
See National Security (Economic Organization) Regulations, p. 1347. See THE
EcoNOMIsr,
February 14, 1942; AUSTRALIA, March, 1942.
391
15 AusT. L. J. 102.
3 9 2See (1941)
Mellon v. Weston Dodson & Co., 20 F. (2d) 549 (C. C. A. 1st 1927) (coal meant
for export market).
393Cf.,
ibid.
394Cf. Brooks-Scanlon Corp. v. United States, 265 U. S. 106, 123, 124-126 (1924);
Perry v. United States, 294 U. S. 330, 357 (1935) ; Smith v. United States, 67 Ct. Cis.
182 (1929). But cf., Ocean 1S. S. Co. of Savannah v. United States, 64 Ct. Cis. 98
(1917), cert. denied, 277 U. S. 584 (1928), where, in the face of such facts, a substantial
recovery
apparently was allowed.
395
Russell Co. v. United States, 261 U. S. 514 (1923). As long as the courts decline
to give recovery for the effect of a regulation to all more or less similarly affected, it
would hardly be consistent to ignore the effect of the regulation when the property is
taken.
390
United States v. New River Collieries, 262 U. S. 341 (1923) ; C. G. Blake Co. v.
United States, 278 Fed. 861 (S. D. Ohio, 1921), aff'd on other grounds, 279 Fed. 71
(C. C. A. 6th 1922); Prince Line, Ltd. v. United States, 283 Fed. 535 (E. D. N. J.
1922), writ of error dismissed, 263 U. S. 727 (1923) ; Gulf Refining Co. v. United States,
58 Ct. Cis. 559 (1923) ; Chicago K. & W. R. Co. v. Parsons, 51 Kan. 408, 32 Pac. 1083
(1893) ; cf. Memorandum of Attorney General, H. R. Doc. No. 264, 72d Cong., 1st Sess.
(1932) ; Note, American Economic Mobilization (1942) 55 HaRv. L. Rxv. 427, 531, 532.
There may be a question as to how general a price control may have to be in order to
permit the government to acquire the property at the price ceiling. In National City
Bank v. United States, 275 Fed. 855 (S. D. N. Y. 1921), aff'd on other grounds, 281
Fed. 754 (C. C. A. 2d 1922), appeal dismissed, 263 U. S. 726 (1923), the court found a
CORNELL LAW QUARTERLY
[Vol. 27
the absence of a general price ceiling on the article, it would seem that appreciation in value from war causes should be allowed, since otherwise purchasers
who had paid the appreciated value would be unfairly penalized, and an owner
would not receive enough compensation to be able to purchase similar property.
The fact that a rate of compensation is fixed, which is generally fair and
equitable, would not bar an individual owner from recovering the value of
3
his property. 0
In England, under the Compensation Defence Act of 1939, and several
of the Defence Regulations, 398 no account is to be taken of appreciation in
value due to the war. Unless the government fixes land sale values generally,
a cause for complaint may well arise, not merely from the owner whose
property is taken by the government, but from the public at large who look
sourly at the favored position of the government while they watch land values
go beyond their meager pocketbooks. 399
If the government fixes a price to itself above that at which the article may
generally be sold, some difficulty exists under the doctrine that just compensation must be just to the government as well as to the owner. The courts
have permitted the legislature to grant a greater recovery than the courts
themselves would have allowed.40 0 A price which enables an entrepreneur to
carry on his activities at a reasonable return would undoubtedly be upheld,
even though the government pays him more than it would pay another for
the same article, where the government, in aid of the war effort, needs the
article.
small segment of the market which was free.
But cf. 53 STAT. 1255, 46 U. S. C. § 1242 (1939), providing, in respect to requisitioning of ships, that "in no case shall the value of the property taken or used be deemed
enhanced by causes necessitating the taking or use." Cf. Hearingsbefore the S. Con. on
Commerce
on S. J. Res. 67 and H. R. 4466, 77th Cong., 1st Sess., p. 25.
39
7Gulf Refining Co. v. United States, 58 Ct. Cls. 559 (1923).
39
8E.g., Reg. 51a. See Note, (1940) 84 SOL. J. 387. This has been criticized on the
ground that the State gets the benefit of depreciation but does not give credit for appreciation. It has been defended on the ground that it is undesirable that taxpayers' money
should be spent on inflated values, and unfair to the taxpayer to pay more than the
depreciated value. Report of Mr. Morris on the requisitioning of land and buildings
and the operation of the Compensation (Defence). Act, 1939, Cmd. 6313 (1941). Cf.
Canadian Orders in Council, Order of March 17, 1917, Canadian Statutes (1917)
CVIII-CIX: If by order of Governor General in Council it is declared that compensation
shall not exceed a certain amount ("which may be a nominal sum") then the right to
compensation
recoverable is not to exceed such sum.
399 See TEaE ECONOMIS, December 13, 1941, p. 715. As a post war measure to insure
proper planning and to discourage land speculation, large scale nationalization of land
has been seriously discussed. TiE ECONOMiST, January 10, 1942, p. 31.
400Cf. Dohany v. Rogers, 281 U. S. 362 (1930); Goslin Mfg. Co. v. Providence, 262
U. S. 668 (1933).
The Government has been authorized to pay more than ceiling prices on a number
of items. E.g., Office of Price Administration, Press Release, PM 3610, June 10, 1942.
1942]
PROPERTY UNDER A WAR PROGRAM
531
5. Interest.-The first world war cases firmly established the principle
that interest upon the compensation award is part of the just compensation
to which an owner i's entitled under eminent domain.401 Since a right to
compensation is of diminishing value if it is not promptly payable, fairness
to the claimant justifies the addition of interest from the time of the taking
until the time of payment,40 2 but if the award is no greater than the amount
initially tendered, no interest is required. 40 3 Where the government makes
a partial payment after a taking, compensation is computed on the basis of
the amount found due plus the amount of interest from the date of the taking
to the date of the partial payment, less the amount of the partial payment
plus the interest on the difference from the date of the partial payment-until
full payment is made.
4 4
0
In New York, when a mortgagee asserted his rights to the award in the
condemnation proceeding, it was held that he was entitled to interest pending
payment of the award at the rate the condemnor must pay, and not at the rate
fixed in the mortgage. 40 5
Where the government has taken possession, pending the taking of the
estate desired, in condemnation proceedings interest is recoverable not qua
interest, but as a pragmatic method of valuing the period of use and occupation. 40 6 It would seem to follow, therefore, that in the absence of a taking
of possession or title, no interest would run on the award. 40 7 At least one
federal court, however, has held to the contrary. 40 s
No particular interest rate is fixed by the Constitution for eminent domain
40
Liggett & Myers v. United States, 274 U. S. 215' (1927) ; Phelps v. United States,
274 U. S. 341 (1927). Interest is recoverable whether the taking is in condemnation
proceedings or without resort to condemnation. See State Highway Commission v.
Mason, - Miss. -, 6 So. (2d) 468 (1942). But there is a difference of opinion among
the Circuit Courts of Appeals as to whether the interest part of the award is to be
treated as capital or income for tax purposes. See Comm'r of Internal Revenue v.
Kieselback,
10 U. S. L. WEEK 2677 (1942).
402
In condemnation proceedings, a check is deposited in court as payment. Since it
comes from Washington, it is necessary to compute interest for several days after the
check
3 is drawn.
40
Luckenbach S. S. Co. v. United States, 272 U.'S. 536 (1927).
4 04
DeLuca v. United States, 84 Ct. Cls. 217 (1936). Interest on the part of the award
initially offered is not recoverable. Curtis v. United States, 65 Ct. Cls. 139 (1928).
Mattern
& Carre v. United States, 66 Ct. Cls. 559 (1928).
4 05
406Muldoon v. Mid-Bronx Holding Corp., - N. Y. -, 29 N. E. (2d) 217 (1942).
E.g.,
United States v. 62 Parcels of Land, 22 F. Supp. 540 (D. Del. 1938).
407
The form of judgment entered on an award where there has been no taking is a
conditional judgment that the estate shall vest in the United States upon payment.
Since there is no right to compensation (the United States may abandon after the judgment and prior to the taking) at the time of the award, the basis for starting the interest
running is lacking, especially since the claimant's possession has not been disturbed.
And, since the measure of just conipensation is a federal question, conformity cannot
be408
used to bring about a contrary result.
Morton Butler Timber Co. v. United States, 91 F. (2d) 884 (C. C. A. 6th 1937).
CORNELL LAW QUARTERLY
[Vol. 27
proceedings; the interest rate adopted may, but need not, be the legal rate
of interest in the locality' of the taking. 40 9
VIII.
DAMAGE FROM HOSTILE ACTION
No prior wars have witnessed the extent of property destruction which
this war has brought with it. The airplane, with its destructive cargo, has
brought most countries face to face with an awesome social and economic
problem: What should be done for the owner whose property has been
damaged or destroyed? Apparently, no country has been willing to face this
problem squarely in the initial stages of the war. Nations have not acknowledged any traditional right of compensation for loss suffered from enemy
action. 410 But at present, there are few nations engaged in the present struggle
which have not fixed by law some scheme of compensation.
Before discussing this development, it is well to point out that any comprehensive scheme of compensation should provide for injury suffered from war
operations as well as from enemy action. The owner of a house destroyed
by anti-aircraft fire should be in no worse position than one whose home is
destroyed by an Axis bomb. A statute providing for recovery for injury from
"enemy action" would seem to be too narrow, unless liberally construed.
In England, in 1937, and shortly after the war began, the government took
the attitude that it was not practicable to cover war risks on land because
of the fear of large scale damage and of possible unlimited financial drain
on the public purse. For a while help was given to real property owners
largely by way of facilitating repairs to damaged structures. 4 n1 The War
Risks Insurance Act, passed on August 4, 1939,412 together with a number
of statutory rules and orders, effected a scheme of compulsory insurancewith some exceptions-for stock in trade. The War Damage Act of March
26, 1941, is an elaborate statute providing for compulsory insurance as to
certain types of property, and voluntary insurance as to other types. Value
payments were fixed on a basis as of March 31, 1939. The amount of actual
damage has not approached the estimate upon which 'contributions were
based. 413 In respect to goods which have suffered war damage, rationing
409
See Kaplan, Interest Obligations in the State of New York with Especial Reference
to Condemnation (1941)
410
11 BROOKLYN L. Rav. 63, 71.
In France there has been considerable debate as to whether or not there is a right
to compensation for such injuries. See Duguit, Compensation for War Losses (1919)
13 ILL. L. REv. 565, 568. The United States is familiar with the French Spoiliation
claims of interminable history in the Court of Claims.
411(1940) 121 RouND TABLt 187. Cf. Housing (Emergency Powers) Act, Sept. 1,
1939; Essential Buildings and Plant (Repair of War Damage) Act (1939).
4122 & 3 GEo. VI, c. 57.
413
The Act has been criticized for this reason, as well as an alleged gratuity to
1942]
PROPERTY UNDER A WAR PROGRAM
restrictions have been eased to facilitate replacement and the sale of damaged
414
goods.
Italy, by a Decree-Law of October 26, 1940, passed a Compensation for
War Losses Act which provided compensation for war damages and empha416
Germany, 416
sized the states' desire to effect a replacement in capital goods.
Australia, 41 7 and Canada,4' 8 in that order, have thought it wise to prepare
for compensating war damage.
In the United States, shortly after the attack on Pearl Harbor, the Reconstruction Finance Corporation created a subsidiary-the War Insurance
Corporation. 41 9 This corporation has been superseded by the War Damage
Corporation, and through that corporation Congress has provided for a system
of voluntary insurance for property damage. 420
mortgagees not required to contribute.
EcONomrsT, January 10, 1942.
See THE EcoNomisT, December 13, 1941; THE
414
Miscellaneous Order No. 11 (1941); S. R. & 0. No. 1237 (1941); S. R. & 0.
Nos.
41 1451, 1452 (1941) ; S. R. & 0. No. 2061 (1941).
5Art.
6. "* * * The State shall always have the right to provide, instead of the
indemnity machines, furniture, merchandise, or livestock of the same kind and of
equivalent value to those damaged or destroyed."
Art. 8. "Compensation for immovable goods and for industrial plants is conditioned
upon their reemployment, to be accompanied by restoring to their former condition the
goods damaged or destroyed." Cf. Duguit, Compensation for War Losses (1919) 13
ILL. L. REv. 565, as to the debate in France on whether compensation should be conditioned
upon an obligation to restore.
416
Pfundtner-Neubert, Dos Neze Deutsche Reichsrecht, I RV 12, p. 1-66.
41 7
AUSTRALIA, January, 1942, p. 7.
41
sSee (May 2, 1942) 7 Fop- Coir. WEEKLY 14.
4 19
Information Digest, December 23, 1941.
420
Pub. L. No. 506, 77th Cong., 2d Sess.